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Variety Editorial

Walk into any electronics store this holiday season and you’ll find a bewildering selection of home-entertainment gizmos with competing claims, formats and services.

Consumers are looking for assurance both from manufacturers and entertainment companies that the hardware and content they buy today will work together smoothly — that their new PC’s, digital music players, high-def TVs and DVD players offer maximum choice across the media spectrum.

That’s why the decision by Hollywood studios this week to embrace competing high-def DVD formats is a major cause of concern.

High-def DVDs represent the next wave of the homevideo revolution, which has been a rollicking success both for consumers and for Hollywood studios, which now generate far more revenue from DVDs than from theatrical box office.

But the bitter standoff over high-def DVD formats could temper the success of the format, sewing confusion among consumers while dampening the financial bonanza for studios.

Sony, along with its soon-to-be corporate partner, MGM, which together controlled 19% of the DVD market through October this year, has cast its lot with the Blu-ray format, backed by Sony Corp.; Time Warner, Paramount and Universal, which represented 41% of the market in the same period, have chosen HD DVD, whose primary backer is Toshiba.

Without an industry standard, consumers would need two separate DVD players to watch films from these studios — an untenable situation. One format is certain to fall by the wayside eventually, just as the VHS prevailed over Betamax two decades ago.

Competition between hardware manufacturers has certainly been healthy for the home entertainment business, generating a dazzling array of new consumer technologies. But it’s important to remember that many Americans are technophobes, easily alienated by expensive and unwieldy gadgetry.

The format confusion stems in part from corporate synergy plays that shaped the media landscape in recent years: Sony Pictures has no choice but to embrace the standard backed by its corporate parent; Time Warner controls some of the patents for HD DVD.

But studios should look beyond the synergies of the competing hardware systems. They should make their libraries available in both formats and grant consumers the power to choose between Blu-ray and HD DVD.

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