Well, what could be the ideal title to describe such a situation? Blu-Ray dumped by its allies? The betrayal of the studios hits deep in Blu-Ray’s heart?  HD-DVD and Paramount: a new love affair? It’s kind of hard to choose between all these titles. But let’s leave aside journalistic dilemmas, and let’s take a closer look at what has happened.

Yesterday, Paramount and DreamWorks, both owned by media giant Viacom, have decided to favor the HD DVD in detriment of Sony’s Blu Ray because it’s apparently cheaper (lower manufacturing costs) and has a market-ready technology.

The exclusive HD DVD commitment will include all movies distributed by Paramount Pictures, DreamWorks Pictures, Paramount Vantage, Nickelodeon Movies and MTV Films, as well as movies from DreamWorks Animation, which are distributed exclusively by Paramount Home Entertainment.

The first movies to be released in the HD DVD format are Blades of Glory (on August 28), and two of this summer’s blockbusters, Transformers and Shrek the Third. The three movies have grossed revenues of more than 1.5 billion dollars worldwide.

Paramount Pictures and DreamWorks’ arguments seem logical enough. HD-DVD is cheaper to manufacture, the players are cheaper compared to Blu-Ray players, and therefore HD-DVD is better.

Also On May 20, Toshiba started offering an enticing rebate on select HD DVD player models, effectively slashing the price on the bottom line HD-A2 model to $299. During that same period, Amazon.com cut the price even further, to as low as $238 over Memorial Day weekend. The lower price shot up the player to be the top-selling DVD player on the site, while Costco was selling the Toshiba HD-D2 (same as the HD-A2) for $249 with a free HDMI cable.

Earlier this month, Toshiba announced its third generation of HD-DVD players. The entry-level model, called HD-A3, features 1080i output capability and it will be available for a suggested price of $299.99 in October 2007. Toshiba HD-A30 is the mid-level model, but it offers an output 1080p resolution (1920 x 1080p), the highest HD signal currently available and includes also  features "CE-Link" (HDMI-CEC), allowing two- way control between the HD DVD player and a TV through an HDMI connection. With a recommended price of $399.99 HD-A30 will be the first to arrive on the market sometime next month. 

But, let’s go back to Paramount Pictures decision. Regardless of the fact that, to me as a consumer, it seems strange that a company is ditching a format that it was extolling not long ago, how much do the new allies help the HD-DVD fans?

The movie studios have always been a major ref in the battle between the two formats, and their support of Blu-Ray had a major effect on Sony’s invention.

As a proof the number of Blu-Ray discs sold on the US market surpassed the numbers of HD-DVDs.

Home Media Magazine reported that since the almost simultaneous launch of the two formats in spring 2006, an estimated 3.7 million high-definition discs have been sold, including 2.2 million in Blu-ray and 1.5 million in HD-DVD through the end of July.

The same source mentioned that sales of Blu-ray discs totaled 1.6 million units from January 1 through July 1, compared with 795,000 HD-DVD discs sold in the same interval.

So, indisputably, Paramount Pictures and DreamWorks could tilt the scale in the favor of the format that Toshiba stands for. But in no decisive way, and that doesn’t mean that one of the formats will disappear.

Because let’s not forget that the Blu-ray format recently got a big boost as Blockbuster Inc. announced it would stock only Blu-ray titles when it expands its high-def DVD offerings this year.
Target Inc. said it will only sell Blu-ray DVD players in its stores in the fourth quarter.

But the future will bring probably an imposed truce in the HD-DVD versus Blu-Ray war. The release of dual players that can play both HD-DVD and Blu-Ray is already a reality and as their prices will go down the consumers won’t have to choose a side but they will be able to have access to both technologies.

In that moment the movies studios will be forced to readjust their offer and to think whether it wouldn’t be more efficient to offer movies in both formats.

So, for the moment, the support that Paramount and DreamWorks offer HD-DVD scales the balance, but for the long run it is likely that the studios will remain faithful to one format or the other. Of course all but Sony, from whom it’s doubtful we will see movies in HD-DVD format.