Microsoft Fueling HD Wars For Own Benefit?

DaveyJJ writes "According to Transformers' director Michael Bay, in a story over on Electronista, Microsoft is deliberately feeding into the HD disc format wars to ensure that its own downloads succeed where physical copies fail, he says in a response to a question posed through his official forums. The producer contends that Microsoft is writing "$100 million dollar checks" to movie studios to ensure HD DVD exclusives that hurt the overall market regardless of the format's actual merit or its popularity, preventing any one format from gaining a clear upper hand."

Doesn't sound like Microsoft.

[jellomizer]

Embrase, Expand, Extinguish. that is not how Microsoft works they get by by making quality products...

No I couldn't write this with a straight face.

I call bullshit on this one...

[arexu]

After all the tripe Michael Bay's given us, I'd doubt him if he said the sun comes up in the east.

Alternative explanations

[KingSkippus]

...Or maybe it's because Microsoft has been a strong backer of the format since the very beginning, and doesn't want it to end up like all of Sony's other consumer device formats. (Betamax, MiniDisc, Memory Stick, SACD, UMD...)

...Or maybe it's because HD-DVD is the format that its cash cow video game console system supports, whereas they have nothing to do with Blu-ray.

Of course, I could just be grasping at straws.

At any rate, I do think he is right in that neither format will be the choice for obtaining and playing hi-def content, online distribution ultimately will win.

If comments like these had any merit....

[MistrBlank]

... winning a monopoly case against Microsoft wouldn't Michael Bay is just PO'd that he isn't making more money hand over fist on that abortion of a commercial called "Transformers". I couldn't even tell it was a real movie through all the obvious and in your face product placement.

proof?

[gEvil (beta)]

Does he have any sort of proof to back up this assertion? Not to mention that TFA states that Bay has gone on record saying he prefers Blu-ray. Considering all the crap that Michael Bay has put out, I have no problem calling this his own version of FUD.

Strategically consistent

[tbg58]

This development appears to be consistent and predictable. Look at Vista and its license agreement, and you see M$ trying to control not only the software layer but levying requirements on hardware makers, i.e. toe the line and show commitment to DRM in every layer of hardware or M$ won't certify your drivers, and this means NOT providing any open source drivers to the Linux community. Although Peter Gutmann's essay contained some inaccuracies, it detailed these steps. Why did M$ abandon technical functionality for the end user in favor of an OS that provides a bit of eye candy to users but a whole lot of technology that is aimed at protecting content provider monopoly? Why did they release the ultra-DRM portable platform, the Zune, about the same time? Why is M$ now meddling in the media content market, apparently trying to orchestrate some sort of movement in HD media? It has looked for some time like M$ sees the revenue stream Apple has through ITunes and thought it worthwhile to put a stake in the ground for developing a media market. Which, in typical M$ fashion, they want to control absolutely. Look for M$ to either acquire or announce a media provider that offers only protected WMA and ultra-DRMed MP3 formats to compete against ITunes. M$ sees that the OS and application space has limited legs. They appear to be making a move toward becoming a content provider. Pretty savvy on their part, but I think their jack-booted super-mega-ultra-DRM approach will not be well received. They're either way out in front on the cutting edge, or a dinosaur trying to put a cap on emerging mammals in the media marketplace. Time will tell.

FUD

[east coast]

Maybe MS sees Blu Ray as the next Betamax? (http://arstechnica.com/news.ars/post/20060420-6641.html)

Maybe since they're offering their set top game box in HD DVD it's a business interest?

What's the problem here and why is this news?

They have real interest in seeing HD get the upper hand. Yes. Would they like to see downloadable content as a better business prospective? Yes. Who doesn't. MS has invested billions into their 360 product, throwing in a bit more money to give it the edge in home movies isn't unthinkable and certainly isn't unheard of.

I seriously do not understand why people are in such a twist over this. Oh, that's right, it's because it's big bad Microsoft and we all need to focus our attention for our daily two minutes of hate.

Re:Alternative explanations

[$RANDOMLUSER]

...because HD-DVD is the format that its cash cow video game console system supports...

And, alternately, Blu-ray is what Playstation 3 supports, which I think is more like what thier real motivation is - Xbox vs PS3.

Re:FUD

[Tom90deg]

Heh, what I find funny is that if, say, Apple, did the exact same thing, people would be happy.

Re:I call bullshit on this one...

[jedidiah]

pppffft.

That's already the case with Tivos and Tivo-like devices.

You just wait until it's "been released" and then decide
when you're going to get around to watching it after that.
The more storage space you have in your PVR, the more it
starts to look like your own personal VOD system. You
just need to give it a little time to accumulate stuff.

Streaming is always open to problems. Whereas whole files are
a lot more reliable to deal with. It doesn't really matter if
they were downloaded from a torrent or recorded off of some
TV broadcast channel.

Responsibility

[Dancindan84]

If they know it's going to hurt the industry, it's the studios responsibility to not take that check. They're the ones living off the industry, so it's their job to make sure it's sustained. If they repeatedly shoot themselves in the leg for (relatively) small kickbacks, they can't be surprised when they hit an artery.

Re:Alternative explanations

[PlatyPaul]

I was with you right up until the end....

I do think he is right in that neither format will be the choice for obtaining and playing hi-def content, online distribution ultimately will win.

Online distribution is only feasible if you have an Internet-enabled device connected to your HDTV. Sure, media center PCs are getting more common (and more affordable), and the numbers [vgchartz.com] on HD-ready game consoles are steadily rising, but the vast majority of HDTV owners do not possess either (a fact that will likely remain, as the magnitude of the HDTV sales figures [parksassociates.com] indicates).

Maybe in 10 years the tide will have turned and most people will be using online distribution. However, there's serious money to be made in the meantime, and that requires physical media.

Re:I call bullshit on this one...

[flitty]

Yeah, it's so nice to be able to drive down to the local Hollywood Video, pick from 1000 greatest hits (who the eff doesn't have Eraserhead in their library!!) and be back to watch the movie in 15 minutes. Sooo much better than telling my computer to do it. Especially since I have to slide down the road in the snow. Oh, and keeping that downloaded video on my computer so it's instantly accessable? Out of the question. Our Commadore 64's don't have that kind of storage space!

I get your point that right now there are hardly any aspects of downloadable content that is appealing (streaming is sketchy, DRM destroys freedom, cost should be less for a soft copy, etc.), but the first company to solve these problems will kill hard copies as fast as MP3's killed CD's.

Re:Strategically consistent

[nschubach]

I thought about that too. A while back actually. If MS causes waves in the media industry. Get consumers pissed off and not buying, then stock prices fall and they can buy into some of these studios. They've already started putting up data centers. (preparing for what?) I think they saw the success of iTunes and wanted to get a leg up on the next thing. iMovies? Moviesoft? If they can buy into the studios, they can get voting privileges and coax the studios into giving the "exclusive" access to heavily DRM'd download movies. I'm pretty sure this is why Vista was so DRM heavy and the whole move behind Media Center functionality. To get that ball rolling in their biggest market. Once (if) they get to that point, they simply claim that OSX and Linux are not secure enough to protect the artist and therefore they do not support clients on those machines. They essentially turn the movie industry into the gaming industry and get a cut of every sale cementing their long term income.

Re:Alternative explanations

[91degrees]

Quite. MS are going to cash in whether HD-DVD or their download service is a success. All they really want is for Blu-Ray to fail.

I don't care for the why.

[Xest]

I don't care why Microsoft would support HD-DVD, I'm just glad that they do although the argument seems rather foolish because you could equally argue Sony are trying to fuel the HD-DVD war so that they can sell more PS3s and downloadable movies via their online store too.

The HD-DVD format whilst not perfect is much more consumer friendly in that it's cheaper, it's region free and it's backwards compatible to an extent.

In comparison Bluray suffers from being region locked, having much more unfriendly, more problematic DRM and doesn't support backwards compat. in DVD players.

A lot of people don't want HD-DVD to win because Microsoft are backing it, but I think Microsoft is the lesser of two evils in this case, the biggest bonus for me is the region free part, whilst this is probably largely useless for North American consumers who get films earlier and cheaper anyway for those of us in Europe this is immensly important, rather than paying £23.99 for a film we can import it for about £15 and often get it 6 months earlier. With Bluray you're stuck with your £23.99 cost and the 6 month delay between North American and European releases.

Sadly it may be too late, HD-DVD isn't holding up that well right now it would seem, for me personally if HD-DVD won I would buy an HD-DVD player because of the cheap import HD-DVDs I can buy but if Bluray won I'd go for online purchases of HD content for no other reason than I refuse to pay over £15 for a movie.

Re:Because heaven knows....

[Steve525]

Both Sony and MS throw money into supporting the horse that their respective wagon is tied to. That's how it is.

I agree. However, it is very clear why Sony is willing to dump a ton of money into Blu-Ray. It's pretty much their format. They'll make a killing if it becomes dominant, and they'll loose a ton if it looses.

Microsoft, on the other hand, isn't as heavily invested. For example, their console supports HD-DVD only as an add-on. If HD-DVD becomes dominant, they get some licensing fees on each unit sold, which is no doubt nice, but not that big a deal.

I think Microsoft wants to kill Blu-ray, but they don't care if HD-DVD succeeds or not. They don't want to be at the mercy of Sony for two reasons:

1. If Blu-Ray becomes dominant, they'll be forced to licence it for their next console, (and possibly a XBOX360 add-on). What if Sony denies them? What if the fees put them at too much of a disadvantage.

2. Microsoft envisions some soft of computerized media center in each home. They need some control of the format to do this.

Re:I call bullshit on this one...

[Calinous]

CDs aren't yet dead, and the mp3 format is older than a decade.
      So yes, it will take a decade for downloaded videos to kill DVDs and high definition alternatives

Re:Wait a minute

[GranBurguesa]

No, the complaint isn't that Microsoft is supporting one format over another or even both at the same time. The problem is that they are allegedly encouraging "exclusives" on one format or another, i.e. you want a particular movie, you can only buy the HD-DVD version. This means consumers have less choice, not more.

Maintaining competition...

[mi]

Microsoft really can't do anything right, can they? First they got into a ton of trouble for attempting to help on HTML-browser implementation (their own) win — and the web-masters are still forced to maintain compatibility with completely different programs.

And now Microsoft is blasted for maintaining competition — between multiple formats, because forcing the DVD-authoring teams to make versions for various players is somehow "totally different".

Yes, I know, you'll claim, that "there should be one standard and multiple implementations". Well, if the standard is the high-quality TV-picture/sound (and who really cares for anything else?), than the BlueRay and HD-DVD can be considered just different implementations that should compete in perpetuity...

Re:Strategically consistent

[Anonymous Coward]

Will we ever get away from the "M$" thing? Hahahaha a dollar sign for the S because they have so much money! That'll show 'em!

Re:Alternative explanations

[gad_zuki!]

>online distribution ultimately will win.

Really? So right now in the lo-def world we cant get this stuff to work and Joe Sixpack isnt goign anywhere near it and when he does the quality is shit (netflicks) but next year or two we'll have the extra bandwidth and marketshare and the equipment and joe sixpack's trust and a pricing scheme that works and and ....

Right.

Discs are going to be the delivery mechanism for the forseeable future. MS is backing HDDVD. Sony is with Bluray. This is just a slashdot trolling hit and run page. Enjoy the ad impressions.

Not to mention if anyone pushes online distribution it'll be soaking in DRM. Enough to make bluray and hddvd look like Richard Stallman. This crowd will go apeshit and will never use it.

Re:Wait a minute

[iceperson]

Actually, Paramount and Dreamworks customers had a choice (they could buy movies on whichever format they wanted.) The check from Microsoft was for exclusivity. The end effect was not less choice, but no choice.

Re:I don't care for the why.

[Xest]

Region coding:

http://en.wikipedia.org/wiki/Bluray#Region_codes [wikipedia.org]

vs.

"There is no Region Coding in the existing HD DVD specification, which means that titles from any country can be played in players in any other country."
From the DRM section of:
http://en.wikipedia.org/wiki/HD_DVD [wikipedia.org]
Which has no region coding section as Bluray does.

DVD/HD hybrid discs:
http://en.wikipedia.org/wiki/Bluray#DVD_.2F_Blu-Ray_hybrid_discs [wikipedia.org] (The section is empty)

vs.

http://en.wikipedia.org/wiki/HD_DVD#DVD_.2F_HD_DVD_hybrid_discs [wikipedia.org]

DRM problems:
Nothing about DRM issues on Wikipedia for either format, however as has been reported, the extra layer of DRM I refer to has caused it's fair share of problems:
http://arstechnica.com/news.ars/post/20071007-new-blu-ray-discs-with-bd-drm-failing-to-play-on-some-devices.html [arstechnica.com]

Which facts were you suggesting Wikipedia could correct me on?

Re:I call bullshit on this one...

[king-manic]

It also doesn't make much logical sense. Bay claims that MS is prolonging the format war until they can get downloadable video working right, then swoop in and be declared "A winner is you!" Seems to me that Bay as been watching too many of his own movies.

One of their largest competitors in a huge emerging market has financially backed the other format(Sony). If Sony dominates with blu-ray then it becomes a more attractive feature to potential buyers. If there in uncertainty over the format then it blunts the attractiveness of such a feature. Remember MS real goal, to place a MS controlled media system format into out living rooms.

True, Downloadable video is nice, as is stuff like Video on demand. I can picture telling my kids that "In my day, if you wanted to watch a show? You just had to wait until it was on." However, I don't think that downloadable movies will ever overtake actually having the disk in hand. If I want to watch Army Of Darkness, I don't want to wait 20 minutes for it to stream, then hope that my connection stays steady enough to prevent it from freezing. Just pop in the disk, no problem. The more steps you take from wanting to watch a movie, and pressing play, the worse off it is, in my opinion.

The idea would be DRM'ed download files. So you want Army of Darkness, well you could spend $9.95 and go to the mall for the DVD, go to best buy and get the blu-ray for $29.95, or 12.95 on the download and never have to leave home. They're banking on your laziness.

Re:Doesn't sound like Microsoft.

[Chris Burke]

Blu-ray and HD DVD however offer no significant difference to the consumer, therefor one of the formats will go the way of the dodo, because it doesn't make sense for movie producers to have to produce different types of discs which basically do the same...

Or what I think is more likely: format-agnostic players will become commonplace, and some studios will release solely on hd-dvd, others on blu-ray, and essentially the customer won't have to care.

Not only are both formats very similar technologically, they're also so far quite similar in terms of the amount of money their backers are putting into them, number of studios supporting them, and marketshare. Neither seems poised to take over, nor is there any compelling reason why either should. If the split market is more likely to destroy both formats by harming overall HD adoption than it is to result in one format dominating. In the end I think both formats will survive with neither having been seen to have "won", simply because in order for either to survive, the customer has to be able to stop caring which is which.

Re:I don't care for the why.

[DrXym]

Should we not worry that even those that helped develop the standard can't implement it succesfully then?

Tell me a standard which you believe to have been implemented perfectly by all supporters of it, especially one that remotely approaches the complexity of Blu Ray standard.

Re:Doesn't sound like Microsoft.

[dhavleak]

While the idea of TFA is interesting (that Microsoft is drawing and quartering HD discs to breathe interest into file downloads), the reality is that it's Apple that owns 90% of video downloads and a first place majority share of movie downloads

Apple's video download volumes are irrelevant to this discussion. Xbox live downloads are available in 480p and 720p and it's not hard to imagine that they will be available in 1080p once bandwidths permit it. That's basically in Blu-Ray and HD-DVD territory. iTunes store downloads are meant to be played on portable devices with QVGA screens (or thereabouts). It's not the same market. One is meant for the living room, and the other is meant for DAPs (or DVPs in this case).