Blu-Ray has won the high-definition format war but internet downloading is looming as the next threat on the horizon. After two years of intense lobbying, fierce competition and widespread consumer confusion, Blu-ray has emerged as the winning high-definition DVD format.
Its rival, HD-DVD, is dead. Toshiba announced it would no longer manufacture HD-DVD players, and would exit the market by the end of March. HD-DVD players and discs are already being pulled from store shelves across Australia, and some consumers who backed the technology are quickly ridding themselves of it on internet auction sites.
So what now for the future of movies? Will sales of Blu-ray players skyrocket? Is the consumer confusion over? Are Blu-ray player owners sitting pretty? Or, as Toshiba predicts, will internet movie downloads usurp the Blu-ray format and climb to the top of the movie ladder?
It's a big call, but media analyst Steve Allen claims it is "inevitable" and will happen within the next five years.
The debate over the future of movies began in 2006 with the start of the high-definition format war. Toshiba released the first HD-DVD players into the market in March and into direct competition with the Sony-backed Blu-ray format.
Both technologies offered significant advantages over regular DVDs, most notably pictures with five times the resolution, making scenes look sharp and faces more detailed.
Both formats also offered better sound, more movie extras and improved in-movie menus, attracting the attention of home cinema buffs.
But there were significant differences between the formats as well. HD-DVDs were free of region coding and the discs were cheaper to produce, while Blu-ray discs had a larger capacity and were more difficult for movie pirates to manufacture.
Ultimately, HD-DVD lost the war when the majority of movie studios backed the Blu-ray format, leaving HD-DVD owners with few movie-buying choices.
But in announcing Toshiba's decision to stop manufacturing HD DVD equipment, Australian general manager Mark Whittard made a bold prediction: the longevity of Blu-ray was limited and would ultimately be overtaken by movie downloads.
"We believe from as early as next year, next-generation DVDs will be leapfrogged by internet movie downloads," he says. "The movie downloading wave is coming a lot sooner than we thought." Mr Whittard says Toshiba will focus on further developing this internet-based movie market rather than supporting the Blu-ray format.
But how far away are we from replacing trips to the video store with clicking and screening our favourite films via the internet? Fusion Strategy media analyst Steve Allen says the market is still in its infancy in Australia, but will soon become part of our everyday lives.
"In five years from now I think it will be a normal part of the market," he says.
"If you make them available at the right speed, quality and price it would be a success and would dramatically cut movie piracy. This, of course, would mean you could play them on a television and that you only had a limited licence (to screen the movie) for X number of days."
Mr Allen says the high rate of illegal movie downloads in Australia demonstrates that internet users understand the technology and are ready to use it ? but movie studios and service providers still have to work out the right structure for such a service that would provide convenience while protecting the artists' work.
"It is in the movie houses' interests to find a way of doing this, because that will choke off piracy," he says. "The speed, convenience and quality of movie downloads will outflank the fakes."
Movie downloads in AustraliaAustralian internet users already have two legal movie download services at their disposal. The largest is BigPond Movies from Telstra, which launched in February 2006.
BigPond Movies also features a DVD rental service that works via post, and Telstra corporate communications manager Craig Middleton says it still has "a much larger audience" and more titles than the download side of the store.
"We have 4000 titles in our online store at the moment and that is a small percentage of what is available in terms of the entire movie catalogue from Hollywood," he says. "We have over 30,000 titles in our DVD store... that's how far we've got to go."
Part of the problem, he says, is working out download rights with the movie studios.
The other problem is the fact that movies must be downloaded to a computer and cannot be burned to DVD or copied to another media and screened on your television. They are automatically deleted from your computer after a specified time period, to prevent the user keeping or copying the film.
While this protects its creators, it also prevents many consumers from watching the film on their preferred screen: the television.
"There are increasingly more and more ways you can wirelessly network it through to a flatscreen or connect your laptop to your flatscreen TV, but we have not reached the super simple method that will find mass adoption," he says.
"We are finding that keen movie watchers will find a way though."
BigPond Movies' main competitor is a company called Reeltime.tv, which counts Sony Home Entertainment as an investor.
Its website has a smaller range of movies to download and rent than BigPond's service, though it also sells movie downloads to own.
These movies cost between $33.95 and $18.95, but once users pay for their preferred movie, they can keep one copy on a PC, one on a portable device and one on a DVD.
However, Mr Allen says both of these services are limited by the available broadband internet speeds in Australia and the download limits of users' internet plans.
Mr Middleton also admits that the quality of these movies is "not quite DVD quality, but very close to it" in order to keep file sizes low.
High-definition movie downloads, he says, would probably only become viable once fibre-to-the-node broadband became available in Australia.
Pay TV provider Foxtel will deliver HD movies later this year, however, via its new HD+ service. The company will "push" eight to 10 high-definition movies to customers' set-top boxes each month, letting users buy access and view the movies as they want.
All of Australia's free-to-air television stations also offer clips from TV shows on the internet, and some offer full episodes online, including free and paid downloads.
The future of Blu-rayJust because Blu-ray won the format war doesn't mean its supporters will rest on their laurels ? or that people who have bought a Blu-ray player can relax.
Makers of Blu-ray players including Sony and Panasonic are preparing to launch more advanced models this year that will include features missing from most current players.
The most notable of these features is internet connectivity, which will let users download extra content such as movie trailers, more movie extras and even simple movie-based games.
Another is a feature called BD-Live that will allow viewers to watch picture-in-picture content. This feature would see a small window appear as the movie played to let an actor explain a scene, for example.
Only Blu-ray fans using the
Sony PlayStation 3 have received access to the BD-Live feature so far.
Ironically, both internet connectivity and the picture-in-picture feature were available on HD-DVD players, and waiting for the second generation of Blu-ray players before investing in one could be a smart move.
The future of HD-DVDJust as Betamax before it, HD-DVD is dead as a format. However, Mr Whittard points out that the high-definition DVD players still have "inherent value". "Viewers can still play their CDs or their DVD library (in a HD-DVD player) and they can upscale their DVDs to near high-definition quality," he says. "In many cases you cannot tell the difference between them."
To upscale or "upconvert" a DVD, the DVD player artificially upgrades the disc's content, which is at a resolution of 480i, to the native resolution of your high-definition TV, be it 720p, 1080i or 1080p. Some DVD players are better at this than others.
Toshiba has also reassured HD-DVD player owners that the company will continue to support and provide service for the equipment for at least the next five years.
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