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Blu-Ray vs. HD-DVD Essay

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Updated: Jan 22nd, 2020

This paper has elaborated the characteristics that lead to the triumph of Blu-Ray standard developed by Sony over HD-DVD developed by Toshiba/NEC. Sony “was once bitten” in the standardization war between Betamax and VHS format; the company leant the value of having a tight linkage of vertical and horizontal supply chain to push a technically superior product for customer acceptance.

In the Blu-Ray vs. HD-DVD war, Sony had an upper hand in their Blu-Ray discs that store 25GB on a single layer compared to HD-DVD having a capacity of 15GB on a single layer. Both HD-DVD and Blu-Ray use the same blue-laser diode technology.

In developing HD-DVD, Toshiba concentrated its innovation on backward compatibility that only required an upgrade of existing DVD manufacturing equipment. Their HD-DVD became a hybrid of two DVD-9 discs to increase disc capacity.

Sony, on the other hand, developed a separate disc, incompatible with existing DVD making equipment that exploited fully the blue laser unique attribute of reading extremely small spots burned on the optical discs.

A higher capacity disc holds more data and enables consumers to enjoy more content in quality or length. A lack of concentration on consumer perception by Toshiba led to the adoption of a misguided strategy, a lesson Sony had painfully learnt to understand the application context that consumers use to evaluate a product.

Significant holdings in motion picture and film subsidiaries held by Sony, gave it a supply chain advantage over Toshiba, which had to initiate partnerships with the existing Hollywood companies that were not already committed to Sony’s Blu-Ray disc.

In addition to a high storage capacity, Blu-Ray discs proved their superiority over HD-DVD through an inclusion of the advanced technology of “digital rights management”, which replaces the “Content Scrambling System” (CSS) used in DVD players. This technology inclusion was a welcome to the DVD Forum that was driving the support and implementation of improved copyright in all standards.

To counter Sony’s capture of the film and motion studios, Toshiba used a strategy of reaching the market first to convert early adopters. This approach faced a set back of a delay in the commercial release of HD-DVD players attributed to the difficulties of implementing the new DRM controls.

As Toshiba was grappling with a the delay of commercial HD-DVD players release, Sony once again relied on its extensive market linkages of vertical and horizontal supply chain, in 2004, releasing PlayStation 3 game consoles that played Blu-Ray discs.

To play catch up, Microsoft’s Xbox 360, a PlayStation 3 rival console, announced the availability of an HD-DVD add on player at a cost to the consumer. The victory of choice, of an integrated player at no additional cost and an add on player at a cost, went to Sony who sold 84,000 Blu-Ray embedded PS3’s in 2007 compared to only 3000 units of add on HD-DVD player.

Toshiba’s HD-DVD failed because it had a lower capacity compared to Blu-Ray in holding high definition movies, concentrated on maintain an existing DVD production infrastructure to minimise costs yet mass adoption of a technology and improved communications now favour rapid replication and lowering of unit costs.

This failure to interpret external environments portrays Toshiba as lacking radar to inform business decisions and maintain a competitive advantage in the technology industry.

Sony’s genius move was in the strategic acquisition and establishment of major entertainment companies that guaranteed an application mechanism to satisfy consumer entertainment needs. The establishment and acquisitions by Sony, made up the company’s network of interest that ensured each subsidiary support the technological innovation as a way to achieve their individual company goals.

Sony further formed a Blu-Ray Disc Association (BDA) that allowed the company to advance their technological advantage with manufacturing and marketing skills, industry accumulated knowledge, distribution networks, financial resources and network linkages to professional bodies and lead users. As a result, by late 2007, there were 154 Blu-Ray titles on the Australian market in comparison to 47 HD-DVD titles.

Sony’s success in the choice of PS3 game consoles to promote Blu-Ray has demonstrated the effectiveness of having strategies that embed emerging and disruptive technology into current initiatives as it assists firms to extract a higher value from existing investments.

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"Blu-Ray vs. HD-DVD." IvyPanda, 22 Jan. 2020, ivypanda.com/essays/blu-ray-vs-hd-dvd-essay/.

1. IvyPanda. "Blu-Ray vs. HD-DVD." January 22, 2020. https://ivypanda.com/essays/blu-ray-vs-hd-dvd-essay/.


IvyPanda. "Blu-Ray vs. HD-DVD." January 22, 2020. https://ivypanda.com/essays/blu-ray-vs-hd-dvd-essay/.


IvyPanda. 2020. "Blu-Ray vs. HD-DVD." January 22, 2020. https://ivypanda.com/essays/blu-ray-vs-hd-dvd-essay/.


IvyPanda. (2020) 'Blu-Ray vs. HD-DVD'. 22 January.

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