Warner ‘THD’ Hybrid Disc to Top Frenzy of Dual-Format CES Activity

An LG combo has been reported and denied for months, and Warner’s ambitions for a hybrid were tipped off in a recently published patent application, on which we were first to report (CED Sept 7 p2). But a CES announcement for the studio’s “Total HD Disc” (CES presentations will sport first look at the “THD” logo) was made public only Thurs. by executives of parent Time Warner. The THD came as a result of the company’s conclusion that a format war between Blu-ray and HD DVD was likely to drag on, said Barry Meyer, Warner Bros. chmn.-CEO. It was best “to recognize that there will be two formats and to make that not a negative for the consumer” and retailers, he said. The company is hopeful other studios will extend support to both formats, as Warner does, and possibly adopt the THD.

Time Warner gave no technical details about the THD, and Warner Home Video declined to discuss any aspect of the hybrid before a Jan. 9 news conference planned for the Bellagio Hotel. But we have learned THD will be a 2-sided “flipper” disc -- not a single-sided multilayer Blu-ray/HD DVD combo as described in Warner’s patent (U.S. 2006/0179448). The THD flipper will have Blu-ray and HD DVD content on either side, either as single- or dual layer configurations. As such, we're told there'll be no capacity constraints to limit bonus material and interactive features, though there won’t be space on the disc for conventional DVD content, as is featured on HD DVD’s Twin Format media. One big THD unknown is its cost. It’s also not known for sure where THDs will be made, but Cinram is WHV’s main replicator and is believed to have participated actively in THD feasibility studies. Cinram didn’t respond to our queries Thurs.

As to licensing or patent issues for the THD, there are no problems or obstacles, we're told. There’s nothing in the Blu-ray and HD DVD standards that prevents content in another format from coexisting on a disc, so long as that content is presented and manufactured according to the format’s specs. As for royalties on THD, we understand any patents will be pooled with others for open licensing.

Other THD information is expected to be released at CES, such as its packaging -- or whether WHV will issue future HD movie releases on THD exclusively. Comment on THD from other studios wasn’t forthcoming Thurs., as most, including Sony, said they weren’t independent made aware of the development. Besides the Warner stable of publishers, only Blu-ray and HD DVD supporter Paramount was informed of the hybrid, we understand.

LG didn’t release any details about its dual-format player, except to say it would be released in the U.S. early this year. “LG expects this technological breakthrough to end the confusion and inconvenience of competing high- definition formats for both content producers and consumers,” the company said.

LG’s combo will feature a single drive for Blu-ray and HD DVD playback that was developed by the Hitachi-LG Data Storage joint venture, we're told. That JV also produced the first “Super Multi” DVD drives, in Jan. 2003, capable of reading and writing all 3 blank DVD formats. LG, a member of the Blu-ray Disc Assn., has vacillated on the possibility of a dual-format player. Just 2 months ago, the company said it had no U.S. plans for any Blu-ray player, but that this could change by CES. But during a visit to the company’s Seoul hq in Oct., we were told exclusively by a senior executive that a combo was in the works for CES (CED Nov 3 p4). He pegged the price at $1,500, and said LG also planned a combo player bundled with a 47” LCD-HDTV home theater for $7,500. At our deadline, comment wasn’t available from HP on its dual-format PC drive. As for Hitachi, its involvement through the joint venture with LG recalled comments at Oct.’s CEATEC show by senior Hitachi CE executives. There, they told reporters the company was capable of offering a dual-format player, but would first go to market exclusively with Blu-ray products, foregoing a combo deck before 2008, after Blu-ray was established.

News of the LG combo drew comment from various industry groups. “As to both the LG and Time Warner announcements, we don’t usually comment on specific product announcements by our member companies,” said a CEA spokesman. “But those announcements reflect exactly the type of innovation that we see each year at International CES, where more than 20,000 new CE products will be introduced next week. As consumers learn more about all the exciting benefits of next generation DVDs, we anticipate the development of more devices that bring the full benefits of digital video and audio to the home theater.”

The Blu-ray camp took LG’s announcement in stride. “We're pleased to have yet another Blu-ray player coming into the market, which will bring the total to seven individual players -- including PS3 -- that consumers can choose from,” said Pioneer’s Andy Parsons in his role as BDA spokesman. “At the same time, we think that the deciding factor in favor of Blu-ray continues to be our superior content support from seven of eight Hollywood studios, five of which are unique to Blu-ray Disc. The availability of a dual format player is not likely to change this equation at all in our view,” Parsons said. He didn’t comment on Warner’s THQ.

Compared with BDA’s faint praise of LG’s combo, HD DVD backer Microsoft seemed ebullient. “In the event a dual player is released this year, we believe HD DVD will be in a favorable position because HD DVD discs are easier to produce, less expensive to manufacture and contain the most advanced interactive capabilities,” said Kevin Collins, Microsoft’s HD DVD evangelist.

As for THD, Collins told us Microsoft hadn’t been “officially briefed” by Warner, but only received “high-level details” about it before the Thurs. announcement. “However, if we look at what Warner has done to date with their same titles on BD and HD DVD, the HD DVD titles will continue to have more features on them,” Collins said. “For instance, all the HD DVD Warner titles have bookmarking, title timeline, zoom and Dolby Digital Plus, whereas the equivalent Warner Blu-ray titles do not have those features. Again, this is due to the fact that BD does not have mandatory support in the hardware to support these features,” he said. “So, if we were to look at the marketplace today, HD DVD still would have the advantage because the players are cheaper, and the titles have more features. If consumers were wary of being ‘burned’ they could easily buy these THD titles, and go with the substantially cheaper players and play the HD DVD side of the disc that has more features,” Collins said. “It seems obvious with those features and price points that the advantage would be to HD DVD.”

Thomson has no plans to introduce a dual-format player at CES, a spokesman there told us in reply to our queries that the RCA brand was rumored to be sourcing such a product from LG and would show it at CES. But his reply brought another surprising disclosure: Thomson -- which is trying to sell its AV operation -- won’t market a Blu-ray or HD DVD player this year. “As you know, we've been in the market for the past several months with an RCA HD DVD player,” he told us. “That product was successfully introduced and has sold out. We have no plans to market HD DVD or Blu-ray products in 2007, until there is better clarity about which format consumers and the studios prefer.”