Paramount to unleash tons of HD DVD *exclusive* titles!

[Dave Baumann]

Dave, to be honest I have never bought the cheaper argument. At all. It is such a trivial issue since the absolute differences are so vanishingly small. In the long run even smaller!

The costs Paramount are talking about are not the "cheap player costs" thats quoted in the press release but the entire, behind the scenes coding / tooling / manufacturing costs. I'm not sure any of us can quote whether that is "trivial" and, as I said, having done both Paramount are in the best position to judge.

 

[Titanio]

I agree with every word DemoCoder has written on this issue so far. No need to be diplomatic over this. Microsoft is engaged in active sabotage. It is all the more funny that the Hollywood studios would let themselves be divided and conquered at will by the suits at Redmond.

According to a supposed Sony insider at AVS, it comes down to that 150m looking attractive because neither format is generating a lot of money yet. So, in exchange for 150m (which isn't that small relative to the revenue to be generated on these formats right now), they'll keep exclusive to one format for x months (supposedly 'up to 18', according to a supposed paramount insider on AVS), and then later when the formats, or a format, are more lucrative, they can release whatever they want on the more dominant platform. So it's sort of win-win for them. More money now than they'll get in the short term on BD, and the option to release on BD later when the market is bigger and moneyhats would be less meaningful.

Also, Paramount can apparently release some titles (like Speiberg's, and perhaps others), on Blu-ray in the meantime.

FWIW, the NYTimes claims to have confirmed the $150m deal with unnamed Viacom execs:

http://www.nytimes.com/2007/08/21/t...rss&adxnnlx=1187698143-B5wO3L/F+4r1NyAsum87vQ

That explanation makes more sense than others I've read thusfar.

 

[Dave Baumann]

Errr, are we sure those won't be appearing? I'd be very surprised if they got to the point of letting Amazon take pre-orders and then pulled the plug on them. That'd piss Amazon off as well.

Blades of Glory was listed as the first title that was HD DVD only - I'm pretty sure Amazon had a price and pre-order on that yesterday.

 

[inefficient]

Errr, are we sure those won't be appearing? I'd be very surprised if they got to the point of letting Amazon take pre-orders and then pulled the plug on them. That'd piss Amazon off as well.

According to this post they are being canceled. Amazon has not sent out emails informing yet. But they are already no longer listed on the site though.
http://www.avsforum.com/avs-vb/showthread.php?t=893917

And this email reply to www.hidefpreview.com from a Paramount employee also confirms.
http://www.avsforum.com/avs-vb/showthread.php?t=894040

Josh,

Thank you for your email. I will answer your questions as best I can.

1 - As far as we can tell here in marketing, this exclusive deal could last as long as 18 months. I spoke to my director earlier today and even she does not have all the details of this agreement. She did mention we have a lot of clauses which would allow us to release certain films on Blu-ray during this time period.

2 - I cannot comment on this question.

3 - Right now it looks like all announced Blu-ray titles will be or have been canceled. As I mentioned before you still may see some Blu-ray releases in the next 18 months though. I can not get in to the details of that possibility though.

4 - Actually we were as surprised as everyone else today when we found out about agreement with HD-DVD. We found out when we arrived to work today and there had been no rumors at all circulating. I think it surprised us all because we have been working on producing and marketing Blu-ray versions of films such Blades, Face/Off, Top Gun, etc. through the end of last week. I can tell you we have received many calls today from various talent and certain directors voicing their displeasure with this decision. We even had VP's of other studios calling in from what I hear. I have never seen this type of atmosphere in the office. In a way we were on damage control throughout the day. That is really all I can tell you for now.

Take care Josh!

XXXXXX XXXXXXX
Publicity & Marketing
Paramount Home Entertainment
310.xxx.xxxx direct
xxxxxx_xxxxxxx@paramount.com

 

[Zaphod]

According to this post they are being canceled. Amazon just has not

See Daves link above. BD Blades of Glory has shown as 'unavailable' @ Amazon for the last couple of hours. It was 'available for preorder' until 14.00ish CET today, though.

 

[Geo]

According to this post they are being canceled. Amazon has not sent out emails informing yet. But they are already no longer listed on the site though.
http://www.avsforum.com/avs-vb/showthread.php?t=893917

And this email reply to www.hidefpreview.com from a Paramount employee also confirms.
http://www.avsforum.com/avs-vb/showthread.php?t=894040

Whee II then. Amazon must be thrilled, as they'll be on the front lines of the angry consumers who thought they had a deal and performed their part of it.

Edit: That would seem to me to confirm there was some behind-the-scenes deal-making going on (in addition to whatever merits one might claim going forward), as at least some of those titles most have been well along on B-r already and thus costs already incurred.

 

[inefficient]

Close Encounters was Blu-ray only before, this looks like it means that Spielberg / Paramount movies will actually be both now, according to the Paramount interview at Ain't it Cool.


HP is at the moment.

That is because Close Encounters is a Sony movie (Columbia Pictures). There is no chance of it coming to HD-DVD.

Not all Speilberg movies are owned by DreamWorks/Paramount. And he does not have full control over all of them.

For example:
A.I - Warner Brothers
Jurassic park movies - Universal
Minority Report - FOX

 

[Dave Baumann]

Not all Speilberg movies are owned by DreamWorks/Paramount. And he does not have full control over all of them.

Indeed, thats why I wrote Speilberg / Paramount.

 

[Zaphod]

Whee II then. Amazon must be thrilled, as they'll be on the front lines of the angry consumers who thought they had a deal and performed their part of it.

And that would be how many? A couple of thousand at the most? Amazon probably deals with hundreds of thousand of cancellations every month due to stock issues, mis-pricing and whatnot. Besides, BD/Fox has, as mentioned, pulled similar stunts before as far as Amazon is concerned. Probably a very, very tiny issue in the big scheme of things.

 

[Carl B]

Edit: That would seem to me to confirm there was some behind-the-scenes deal-making going on (in addition to whatever merits one might claim going forward), as at least some of those titles most have been well along on B-r already and thus costs already incurred.

The encodes on BD and initial pressing/packaging would likely already have taken place for the BD films, so there's no doubt about that. Also no need to speculate as to whether it's behind-the-scenes deals or not - I think that much is readily apparent, and reportedly Paramount received $150 million for their exclusivity. Now IMO all's fair in love and war, so I don't begrudge HD DVD their efforts - but there's a real risk that the war is going to leave the HD optical landscape scorched and desolate.

Anyway in a countermove of sorts Fox has announced a number of titles for release in the coming months. So... the battle rages on.

 

[RobertR1]

The war started when Toshiba and Sony couldn't come together.

Toshiba is simply taking a chapter out of the BDA's book to gain content exclusivity. Fair to me. Let the war continue!

 

[RobertR1]

One thing readily apparant from this announcement is the fanatical hatred towards MS. It seems like people simply can't accept that MS didn't make the payout. Many have convinced themsevles no matter what is said, MS is to fault solely. AVS forums are a f'in mess!

Now I want HD DVD to win just so I can see all these people cry themselves to sleep! It's much more entertaining than any Hi Def movie so far........

 

[Mintmaster]

Geo,
They sacrificed future earnings potential of a successful industry standard format being established for HD optical. This guarantee’s stalemate for another 18months at least. This makes it a remote possibility that there will be any winner at all. The CFNPV of such a format would dwarf the money they have received in cash and non cash items.

You don't get it. The incremental earnings for the studios are minimal. Whether people buy DVDs or HD-DVD or BluRay, they get pretty much the same money. More HD format sales means less DVD sales. The only opportunity for more money is from people upgrading their favourite DVD titles, and I doubt that would contribute to more than a couple percent of total sales.

The CE companies benefit much more, though, because people need to buy new players with much fatter margins than the dirt cheap DVD players out there now. However, the studios aren't really sacrificing anything if they prolong the war.

I think Toshiba did this because this winter is their chance to leap ahead of BR. They might have a player that's half the cost of BR this holiday season.

 

[Zaphod]

You don't get it. The incremental earnings for the studios are minimal. Whether people buy DVDs or HD-DVD or BluRay, they get pretty much the same money. More HD format sales means less DVD sales. The only opportunity for more money is from people upgrading their favourite DVD titles, and I doubt that would contribute to more than a couple percent of total sales.

In that vein, the lower replication cost and easier access could very well offset whatever sales Paramount are set to loose in the short (18 months) term.

I think Toshiba did this because this winter is their chance to leap ahead of BR. They might have a player that's half the cost of BR this holiday season.

Another aspect is that it is much easier and lower cost for a CE manufacturer to go from a BD player to a dual format one than it is from HD-DVD. Toshiba isn't going that route anytime soon, and I think they'd be more than happy to see higher-end dual format players from the likes of Samsung and LG as these would be more likely to replace a BD-only player on store shelfs (and possibly by extension in consumer homes, which lends even more merit to the lower media replication cost if dual format players catch on).

 

[Mintmaster]

Look at Apple. They don't care. Whichever format wins, they'll sell Macs with it, and include OS X playback capability. Why does MS care SOOO deeply about this fight?

What exactly is the body of evidence that proves MS does indeed care sooooo much?

Not having a BR addon for the 360 is simple because they'd prefer BR to be a minimal selling point of PS3. For everything else, it seems to me they saw an opportunity to give their very good VC-1 codec some traction, so they helped Toshiba get out of the gates ASAP.

I don't even know that prolonging the HD war has much impact on their DD plans. If consumers aren't being swayed by the quality of HD media over DVD, then I don't see how a delayed HD optical format winner has much impact on the marketability of DD.

 

[Sxotty]

The war is good for pushing prices down on players though at least. To bad it isn't good for discs...

Now that is the answer, combo players and the consumer can buy the cheaper disc...Or the better one. To bad that won't really work either since the combo player is so much more expensive.

 

[DemoCoder]

One thing readily apparant from this announcement is the fanatical hatred towards MS. It seems like people simply can't accept that MS didn't make the payout. Many have convinced themsevles no matter what is said, MS is to fault solely. AVS forums are a f'in mess!

Hatred no, opposition yes. It's like saying people opposed to wiretaps or Iraq are 'fanatical bush haters'. Some yes, others are just opposed to the policy ramifications. I have friends who work at MS, I admire Bill Gates and MS in many respects, but I also don't think it is healthy for them to win this battle.

Now I want HD DVD to win just so I can see all these people cry themselves to sleep! It's much more entertaining than any Hi Def movie so far........

Who's the fanatic f*nb*y now?

 

[DemoCoder]

For everything else, it seems to me they saw an opportunity to give their very good VC-1 codec some traction, so they helped Toshiba get out of the gates ASAP.

VC-1 is part of the BluRay spec as well. Besides which, another peeve: There was an international effort to standardize next-gen codecs, call for participation, papers, symposiums, working groups. If MS was truly interested in standards, why didn't they submit VC-1's improvements to the Joint Video Committee and join-in on the standards efforts? Why the last minute SMPTE submission?

MS could have still made money on patents if they had worked though the MPEG-4 committee. The reality is, like with OpenGL, IETF, W3C, and every other open standards group, Microsoft is not a team player, but a bully.

I was part of the W3C working groups on multimedia when MS sabotaged SMIL (because at the time, RealNetworks had both a technological and marketshare advantage) (ironically, SMIL now used in HDi). MS repeatedly tried to stall the CSS working groups, outright refused XForms, and on and on.

Their past behavior is clear Mint, I've experienced it first hand at meetings. I see this as more of the same. MS should technically be format neutral, a common carrier/platform, for any multimedia format. I view their attempts to sabotage peripheral technology in the PC and CE spaces as counter to consumer interest as well as health of the industry.

 

[Zaphod]

There was an international effort to standardize next-gen codecs, call for participation, papers, symposiums, working groups. If MS was truly interested in standards, why didn't they submit VC-1's improvements to the Joint Video Committee and join-in on the standards efforts? Why the last minute SMPTE submission?

Just to be an ass?

Seriously though: Didn't MS convince both the Blu-ray Disc Association and the DVD Forum to include a future version of WMV9 in their respective specs (possibly on the assumption that eventually and inevitably would become an industry standard) long before that actually came to fruition? I always assumed that whatever backdoor coup they might have performed with the SMPTE was just to fulfill some requirement of somebody (i.e. whoever) actually standardizing it.

 

[Mintmaster]

VC-1 is part of the BluRay spec as well.

Sure, but partnering with HD-DVD is a way to get more adoption. They partner with Toshiba to effectively make VC-1 the standard codec, and then the format neutral studios figure they might as well use the same encoding for BR and HD-DVD. Had HD-DVD not existed, I'm not sure VC-1 would have been so widely accepted, nor would enthusiasts have panned Sony's attempt to promote MPEG2 because they'd have nothing to compare it to.

I don't know if VC-1 truly is the best, but I'm just saying that this is a good reason for MS to support HD-DVD. Now that VC-1 is used with BR as well, they probably don't care.

Their past behavior is clear Mint, I've experienced it first hand at meetings. I see this as more of the same. MS should technically be format neutral, a common carrier/platform, for any multimedia format. I view their attempts to sabotage peripheral technology in the PC and CE spaces as counter to consumer interest as well as health of the industry.

Okay. I'll take your word for it. I understand that MS is capable of this sabotage, but I'm not convinced that MS "cares SOOO deeply about this fight".

I don't see them having too much to gain from either HD-DVD's survival or HD-format failure. AFAICS, neither would really help the marketability of digital distribution. Sure, they'd prefer the PS3 to fail, but BR winning the format war one or two years from now probably won't affect console sales much. Thus I don't buy this conspiracy theory that MS is behind the $150M offer in any significant way.