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Netflix to cease carrying new HD DVD titles

The tide continues to turn in the ongoing high-definition format war. Netflix, the first choice in online movie rental service in the U.S., today announced that it will exclusively stock Blu-ray Disc as the only choice for its customers looking for high-definition content.

Earlier this year, Warner Bros. shook the industry when it announced that it would release movies exclusively on Blu-ray Disc starting this summer. Netflix states that, with four major Hollywood studios now behind Blu-ray Disc, it too will back the format held by the majority.

Since the inception of HD DVD and Blu-ray Disc, Netflix gave its customers opportunity to rent from both formats. But by the end of this year, the online rental service will have phased out HD DVD, leaving Blu-ray Disc as the lone option.

HD DVD hardware owners will have to look to alternative rental outlets for software, as Blockbuster announced last summer that its retail stores would also carry only Blu-ray Disc. Blockbuster’s Total Access online rental service, however, continues to provide HD DVD as an option.

"The prolonged period of competition between two formats has prevented clear communication to the consumer regarding the richness of the high-def experience versus standard definition," said Ted Sarandos, chief content officer for Netflix. "We're now at the point where the industry can pursue the migration to a single format, bring clarity to the consumer and accelerate the adoption of high-def. Going forward, we expect that all of the studios will publish in the Blu-ray format and that the price points of high-def DVD players will come down significantly. These factors could well lead to another decade of disc-based movie watching as the consumer's preferred means."

Only a small percentage of Netflix’s seven million subscribers elected to rent high-definition movies, and the company says that most of its customers have chosen Blu-ray Disc over HD DVD.

"From the Netflix perspective, focusing on one format will enable us to create the best experience for subscribers who want high-definition to be an important part of how they enjoy our service," Added Sarandos.

As part of the transition to Blu-ray Disc, the Netflix said it will acquire no new HD DVDs but that its existing inventory would continue to rent until the discs' natural life cycle (through loss or damage) takes them out of circulation in the coming months.

Although Blu-ray Disc may have more support, Universal Studios, Paramount Pictures and DreamWorks Entertainment are still exclusive to HD DVD. This means that Netflix customers will be without a high-definition option for upcoming releases such as Beowulf, Bee Movie, Sweeney Todd, The Jack Ryan Collection, American Gangster, Braveheart, Forrest Gump, Star Trek and potentially even Indiana Jones.



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RE: touche
By Master Kenobi (blog) on 2/11/2008 12:36:26 PM , Rating: 2
Depends on how stubborn Paramount and Universal want to be.


RE: touche
By tallcool1 on 2/11/2008 1:18:21 PM , Rating: 2
In regards to Universal, Paramount...
What are the details of their contract with Toshiba?
I remember there being a $150 Million dollar buyout for producing movies in the Toshiba format. Not sure which company, Universal, Paramount or both?
Are there any options for "either" of these companies?
When does this contract expire?
Is there a "get out of dodge" clause?

I'm sure they are not happy with how things are turning out. As more B&M and E-Stores continue to go Blu exclusive, it is cutting into thier potential profits.


RE: touche
By Master Kenobi (blog) on 2/11/2008 1:29:09 PM , Rating: 2
quote:
What are the details of their contract with Toshiba?

Nobody knows the details, it was sealed (like most business deals).

quote:
I remember there being a $150 Million dollar buyout for producing movies in the Toshiba format. Not sure which company, Universal, Paramount or both?

It was Paramount/Dreamworks that signed an 18 month exclusive contract with HD-DVD. Universal has been the sole iron-clad pusher of the HD-DVD format since day 1.

quote:
Are there any options for "either" of these companies?

There is rumored to be a clause for Paramount's agreement that would leave them the ability to break it after Warner-Bros makes the switch to BR-Only. However I don't think anyone outside of the Paramount legal department knows the exact wording of any clause should it exist.

quote:
When does this contract expire?

Sometime in 2009.

quote:
Is there a "get out of dodge" clause?

Not that anyone knows of.

quote:
I'm sure they are not happy with how things are turning out. As more B&M and E-Stores continue to go Blu exclusive, it is cutting into thier potential profits.

Universal who knows. Paramount, no doubt.


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