Toshiba and NEC's HD DVD format is now officially dead. Toshiba has announced that it gave up on the embattled format. It was about time, some would say, but the Japanese company could not give up without a fight. Aggressive price cuts just could not do it, Blu-ray had too much momentum. The tide was clearly against HD DVD and many abandoned ship, leaving Toshiba with just a handful of allies.

"We carefully assessed the long-term impact of continuing the so-called ‘next-generation format war’ and concluded that a swift decision will be best help the market develop," Atsutoshi Nishida, President and CEO of Toshiba Corporation, said according to an official statement. "While we are disappointed ... Toshiba is both able and determined to use our talent, technology and intellectual property to make digital convergence a reality."

Toshiba Corp. will put an end to the HD DVD business by the end of March 2008, which includes besides players and recorders, HD DVD disk drives for PC applications and games. However, the company will continue to support and develop the standard DVD format.

What will Microsoft do? The Redmond company is known as one of the main supporters of HD DVD format and, in an effort to help Toshiba to win the conflict with Sony’s Blu-ray, Microsoft unveiled in 2006 a HD DVD external unit for its Xbox 360 gaming console. Earlier this month, in line with the price cuts announced by Toshiba for its HD DVD players, Microsoft made a similar move and reduced the price its Xbox 360’s HD-DVD unit from $179 to $129.

What's next, a Blu-ray drive for the Xbox 360? Probably, just not too soon. Indeed, during CES 2008, right after Toshiba lost the support of Warner Bros, a Microsoft official did not ruled out the possibility of a Blu-ray unit for Xbox 360.

The big winner here is certainly Sony. Not only that it threw its weight behind the winning high definition format, but its Playstation 3 users already have included in the powerful gaming console the next-generation DVD player. This means that the conclusion of the HD DVD - Blu-ray war can only boost future Playstation 3 sales, which still remains an affordable Blu-ray player apart from a gaming powerhouse. Last month, according to the data released by the research company NPD Group, the PlayStation 3 outsold Xbox 360 for the first time in months.

However, consumers have probably gained the most from the HD DVD - Blu-ray competition. The war has not only eliminated the weakest of the two rivals, finally ending confusion, but has also driven prices lower than manufacturers would have liked.

Toshiba lost the battle, but the Japanese company has shifted immediately financial resources to the booming market of flash memory. Already used in flash sticks for some time now, flash memory has seen recent use in solid state hard drives and hybrid drives, among other applications. Toshiba and its partner Sandisk announced plans for two next-generation plants in Japan to produce flash memory. The project will cost a stunning $16 billion but will bring about serious profits when finalized. Toshiba shares also jumped, because investors applauded the conclusion of the company's struggle with HD DVD.