Mystery solved: yesterday’s jaw-dropping announcement from Paramount and DreamWorks, according to which the two companies would favor HD DVD over Blu Ray, was indeed economically motivated.
But there were other “economies” involved. Yesterday’s press release sounded like this: “the decision to distribute exclusively in the HD DVD format resulted from an extensive evaluation of current market offerings, which confirmed the clear benefits of HD DVD, particularly its market-ready technology and lower manufacturing costs.”
Moreover, the two entertainment behemoths were apparently in love with HD DVD’s behavior on the market, despite grim forecasts about the format’s future, considering Sony’s technological advancement with Blu Ray and the larger install base (mainly due to PS3).
Prestigious journal The New York Times reported that the true reasons behind this move (Paramount had previously released its titles in both Blu Ray and HD DVD format) is the apparent bribe received by the two companies:
“[…]money talks: Paramount and DreamWorks Animation together will receive about $150 million in financial incentives for their commitment to HD DVD, according to two Viacom executives with knowledge of the deal but who asked not to be identified.
The incentives will come in a combination of cash and promotional guarantees. Toshiba, for instance, will use the release of “Shrek the Third” as part of an HD DVD marketing campaign.”
There is more to this: the “exclusive” support for HD DVD provided by Paramount extends only for a short period of 18 months, and, as announced yesterday, it will not include Steve Spielberg’s creations. High Def Digest asked Spielberg’s long-time spokesman Marvin Levy to comment about a possible release of some of the great director’s movies in high definition and this is what he said:
"It was important to Steven that if any of his films were to be released [first] on high-definition, that it would be a classic. Steven is big supporter of Blu-ray, and chose 'Close Encounters' to be the first of his films on either format."
Andy Parsons, Chairman of the Blu-ray Disc Association US Promotions Committee, said in response:
“The decision seems oddly timed given Blu-ray's tremendous momentum both with consumers and with retail. Blu-ray title sales continue to outpace HD-DVD sales by nearly a 2 to 1 margin, and major retailers have expressed a strong preference for Blu-ray. Moreover, the price delta between HD DVD and Blu-ray players has been greatly reduced in the past few months, a trend that is on its way to eliminating any perceived cost advantage the HD DVD format has claimed to have. Under these circumstances, we can only imagine what could have enticed them to walk away from a format that is clearly selling significantly more software than the ailing HD-DVD format.”
Paramount’s decision is also likely to affect the production of the sequel for this summer’s blockbuster Transformers.
On a post on his personal web forum entitled, "Paramount pisses me off!", Michael Bay, who also directed other titles like “Bad Boys” or “Pearl Harbor” declared, "I want people to see my movies in the best formats possible. For them to deny people who have Blu-ray sucks! They were progressive by having two formats. No Transformers 2 for me!"
