Many consumers are sticking with DVD, but it's not necessarily because of mistaken "perceptions".

In our recent review of the Panasonic DMP-BD55, we offered the view that Blu-ray has almost gotten its act together, after killing off HD DVD, getting more Profile 2.0 players on the market, and offering standalone players for less than $500. However, manufacturers are anxious to get more people on Blu-ray boat as quickly as possible, which is why we get e-mails from Warner Bros. attempting to clear up "confusion" about Blu-ray. According to the press release, the company did a survey of DVD owners that do not own Blu-ray players and found they have a "persistent lack of knowledge" regarding the new format. Warner Bros. offered three main "myths" that have confused consumers, as well as the company's response:

Perception: "I'd have to rebuild my movie library from scratch because Blu-ray can't play standard DVDs."
Truth: The switch from VHS to DVD made huge libraries of content obsolete. That's not the case with Blu-ray. Blu-ray players and PlayStation 3s can play ordinary DVDs! And not only can they play them, but the "upconversion" process makes them look even better!

Perception: "High-definition players are too expensive and I'm not ready to invest in new equipment."
Truth: There are Blu-ray players in the market for as low as $279 and this is expected to drop to $249 by Christmas. Also, PlayStation 3s are a great value, because for only $399 you get a Blu-ray player and a game console. Plus hardware and software companies are joining to offer consumers great package deals on Blu-ray players and PS3s with Blu-ray software.

While there's some merit to Warner's arguments, there's a whole lot of fact-bending going on. The truth is there still aren't that many titles available on Blu-ray right now. According to The Digital Bits, there are 772 Blu-ray titles currently available compared with more than 90,000 DVD titles. Yes, we're seeing many more new movies and TV shows released, but if consumers are expecting the same availability as DVD, they are going to be disappointed. Warner Bros. also argues that high Blu-ray player prices are just a "perception." That's debatable, but it certainly doesn't factor in the increased price of Blu-ray movies, which is significant. Not to mention the fact that if you really want to see the benefits of Blu-ray, you'll want a jumbo (50+ inches) HDTV.

And let's not forget that plenty of this confusion is not consumers' fault. Having several different Blu-ray profiles only added to this problem, as well as the vastly different audio decoding capabilities of the players. So while there have certainly been some misunderstandings about Blu-ray, it's not fair to frame buyers' legitimate concerns (like lack of titles and high player/movie prices) as myths. I say this as someone who does own a Blu-ray player and is willing to pay an extra dollar to rent Blu-ray movies from Netflix. But let's not pretend that the format doesn't need to make a lot of progress before it's a viable successor to DVD.

Warner Bros. Entertainment Group is tired of guessing about how the studio's content will appear on the Web or handheld devices.

That's why the company has built a new media center designed to test how consumers respond to Web sites, consumer electronics, and video-on-demand services that feature the studio's movies and TV shows.

The company behind such films and TV shows as I am Legend, Michael Clayton, and ER, has outfitted the media center with Xboxes, PSPs, iPods, Macbooks, varying brands of PCs, DirectTV, and a plethora of cable subscription services.

The company will bring in everyday consumers and watch how they interact with Web sites, gadgets, or video-on-demand services that feature Warner content. With the help of eight pan-zoom cameras built into the ceiling, researchers will monitor the respondents, according to Bruce K. Rosenblum, the executive vice president in charge of the media center.

"We're not operating in a vacuum anymore because of this center," Rosenblum told CNET News.com on Thursday. "We want to get smarter and understand these technologies a bit better. Warner Bros can just assume about the deals we do. I think it's important that Warner knows the experience."

The studios know that they can't rely solely on the TV set or VHS recorder anymore. Fans are consuming films and shows on video-game consoles, music players like the iPod, and mobile phones. Rosenblum said Warner Bros. modeled its media center after one built in Las Vegas by CBS.

The differences between the two facilities are that Warner was designed specifically to test emerging technologies and is on-site.

Rosenblum decline to discuss costs of building the center. He did say that companies owned by Time Warner, the studio's parent company, are welcome to use the facility.

I have to hand it to fellow analyst Rob Enderle. Way back in August of 2005, he called the high-def format war in a piece titled "Blu-ray Wins or Nothing Does."

Logo of the Blu-ray Disc Association, winner of the high-def disc format war

(Credit: The Blu-ray Disc Association)

Then again, he also said in that article that "the more likely outcome is that the market will bypass both products and move to something else," so perhaps he wasn't perfectly prescient.

And come to think of it, a year later (in December 2006) he changed his mind entirely in columns titled "Optical HD Battle May Be Over: HD DVD Wins," "HD DVD Wins," and "Sony Kills Blu-ray."

And in August and even November of 2007, Enderle still believed HD DVD would win.

Well, if Rob Enderle couldn't predict the result, who could? Even just before the Consumer Electronics Show this year, when Warner Bros. Entertainment announced it would stop supporting HD DVD and join the Blu-ray camp, I was still hedging my bets: "Blu-ray wins, HD DVD loses. Probably.")

But when Wal-Mart--the Brünnhilde of modern retailing--took the stage last week to throw its weight behind Blu-ray, everyone knew it was over. And this week, Toshiba--leader of the DVD Forum, which developed HD DVD--officially conceded defeat. The company aims to end production on HD DVD hardware for home theaters as well as PCs by the end of March.

So we can all relax. Right?

Well, for a while, sure. But remember, DVD and Blu-ray were separated by only five or six years, so presumably we're due for yet another format three or four years from now. And a new format means the potential for a new format war.

The basic parameters are easy to predict. As I described last August in "After HD, what's next?" the heir apparent to HDTV is what's called "4K"-- that is, a display resolution with about 4,096 horizontal pixels and 2,160 scan lines. Sony already makes projectors that support this resolution. Red Digital Cinema makes 4K cameras. Director Peter Jackson has made a short film in 4K, and the "Final Cut" of Blade Runner was remastered in 4K.

So 4K is coming, and it isn't far away.

But why should there be a format war?

Well, there's always a format war. There was even a DVD format war, although we're all fortunate that it was resolved well before discs or players hit the market.

Sony will want to lead the transition to 4K, but the DVD Forum will still be around in five years. That's a recipe for a format war right there.

Will it happen? I sure hope not. Our best hope for a lasting peace is that Sony, Toshiba, and the rest of the DVD Forum members settle their differences and start working on the next generation immediately. If you have any influence within these companies, now's the time to start cooperating on technology development. The future won't wait.

Toshiba may have taken a huge hit recently, but the HD DVD supporter is striking back.

Barely a week after Warner Bros. announced it would no longer put out movies on the HD DVD format, of which Toshiba is a primary supporter, the company announced it is lowering the prices on all three models of next-generation DVD players.

Toshiba will now sell its entry-level HD DVD player for $149.99.

(Credit: CNET Networks)

The entry-level model, the HD-A3, now goes for $149.99, the HD-A30 for $199.99, and the HD-A35 for $299.99. That's about $150 to $200 worth of discounts on all models.

The new pricing from Toshiba is well-timed, according to Paul Erickson, director of DVD and HD market research for The NPD Group. Holiday promotional pricing is essentially over for all the major manufacturers of rival disc format Blu-ray, as well as other HD DVD makers.

"For them to drop MSRPs now couldn't come at a better time," he said. "It was a gap Blu-ray was able to close down upon during holiday sales."

In the battle between HD DVD and Blu-ray, HD DVD's primary advantage from the very beginning had been cheaper prices on players. But Blu-ray has responded, lowering its prices and offering popular promotions, like Wal-Mart's giveaway of 10 Blu-ray titles with the purchase of a Sony PlayStation 3 this past holiday. But preferences over one format or the other aside, price is and probably always will be the determining factor in sales.

"The larger challenge for both camps is twofold: getting the hardware into people's homes. Toshiba did very well selling $99 and $199 players (during the holidays), but that didn't necessarily translate into a big jump in movie (sales)," said Erickson. "Unless there are serious promotions going on...people aren't going out and buying in explosive numbers on the Blu-ray side either."

"Even if we promote a single format...people are still not going to pay three to four times as much for a player, they're not going to pay double the price for movies," Erickson said, "just because they're accustomed to much cheaper pricing on standard-def DVD."

Total HD, the Warner Bros. solution to the Blu-ray/HD DVD face off for high-def home video supremacy, won't be rolled out in late 2007 as promised at CES, a Warner Bros. official said Wednesday.

The first discs, which will feature Blu-ray on one side and HD DVD on the other, will not appear until early 2008, according to Dan Miron, the studio's vice president of sales and planning, who made the comments at an entertainment business conference in Los Angeles.

The studio didn't provide further details, other than to say that it wants to avoid confusing customers further by putting yet another format on retail shelves. Warner Bros. believes that waiting a few more months doesn't make the dual-format disc "any less viable," according to a studio spokesperson.

But with the way things have been going for HD DVD, will a Blu-ray/HD DVD union even be necessary by January? This proposed format marriage may end up like an engaged couple that keeps pushing the wedding date back, but never actually gets around to tying the knot. We shall see.