http://arstechnica.com/news.ars/post/20070...ay-winning.html

According to the Wall Street Journal, the European Commission recently sent letters to Hollywood movie studios asking for communication records and agreements between the movie studios and HD-DVD and Blu-Ray DVD format representatives. The EU wants to know why so many studios are exclusively backing Blu-ray at the expense of HD-DVD; it seems they suspect that Sony is leveraging its moviemaking business in inappropriate ways.

Last August, the European Commission was interested in the business practices of Sony and Toshiba-specifically Sony, who owns Sony Pictures and also markets the Blu-ray-capable PlayStation 3 gaming system-because of its involvement in Hollywood and wider reach in the entertainment industry. Toshiba, on the other hand, does not have an in-house movie studio, nor does it have a gaming system that solely and natively supports HD-DVD playback, though the HD-DVD player for Microsoft's Xbox 360 can be purchased separately.


The European Commission appears to be most interested in why movie studios have generally accepted the Blu-ray standard over HD-DVD, wondering "whether improper tactics were used to suppress competition and persuade the studios to back [Sony's] format." There's no word on what the "improper tactics" might be, but it doesn't come as a surprise that the European Union's executive body is looking into the legitimacy of the format battle. After all, the Blu-ray standard is currently backed by Walt Disney, Sony, Twentieth Century Fox, Lions Gate Entertainment, and MGM. Compare this roster of backers to that of HD-DVD, which is backed solely by NBC Universal Pictures. The European Commission is likely looking into how and why five studios decided to back Blu-ray exclusively while only one exclusively backed HD-DVD. They may also be investigating why Blu-ray devices are typically priced much higher than their HD-DVD counterparts.

Sales haven't been strong for either format's players, though, as the WSJ also reports that only "105,000 homes have Blu-ray players, and about 150,000 have HD DVD players. An additional 1.5 million homes have PlayStation 3 devices... About 160,000 consumers have bought add-on devices for Xbox machines that allow them to play HD DVDs." Perhaps the ongoing European Commission investigation will shed more light into which new DVD format will win out in the future. With just 1.9 million devices sold with the ability to play the new format, it's clear that the public is waiting for a conclusion to the format battle.


EC Expands Probe of High-Definition DVD Formats

BRUSSELS, July 3: The European Commission is seeking information from the Hollywood studios as part of an informal probe into whether the two competing high-definition DVD formats, Blu-ray and HD DVD, engaged in anti-competitive behavior, according to wire reports.

Sony, Disney and News Corp. are all releasing titles on the Blu-ray format, as are Lionsgate and MGM, while Universal has opted for Toshiba's HD DVD standard. Warner Bros. and Paramount Pictures are releasing DVDs on both formats.

According to reports, the Commission is looking for information from the studios on how they chose the format for their releases. "We have sent a request for information to a number of studios concerning possible discrimination against one or other DVD format," Commission spokesman Jonathan Todd is quoted as saying. "We're at the stage of basic fact-finding. We have not opened a formal investigation."

The Wall Street Journal reports that the Commission is particularly interested in Blu-ray, and is investigating if improper tactics were used to encourage the studios to opt for that format.

The latest information request from the studios follows letters sent by the Commission to Blu-ray and HD DVD requesting details on their licensing strategies.

so EU commision abang adik with toshiba / microsoft?

no lah. Microsoft oso kenak once by the commision. MS paid hundreds of millions to them. EC is attempting to protect European company involved in the war

wah, so this EC neutral kaki ar?

neutral or not,this has nothing to do with gaming,so why's it in console couch?

aiya, simple reason la... becoz mod tak mau bukak satu thread khas untuk videophile @ hd stuff... so main taruk je la mana2

hehehehe..i think i heard it before......

hahaha this thread is the closes to the topic because of PS3

The EU forgotten something, Sony acquired Columbia Pictures and MGM studios, both account for half of the movies released in Hollywood so there's nothing wrong for Sony to push Blu-Ray via their own studios because they own the studios, they can do what they like unless Microsoft manages to takeover Sony, the HD-DVD camp will not be able to compete on equal grounds with the Blu-Ray camp.

they are investigating the possibilities that some Studios are 'prevented' from releasing titles on the competing format. meaning - sony - i give 20% subsidy on each BD replication cost but to get that, you cannot release titles in HD DVD. or You will have access to BD50 only with the term that you support us exclusively. Have you heard of the boardroom rumour that a Panasonic head theaten LG with lawsuit for contract breach because they announce their Universal player. This is what EC is trying to get to

LOL sounds to me like EU its suspecting Sony of becoming the next "Umbrella Corporation". Monopolize the movie media industry with vast "financial backing".

In the end, whichever media lose the consumer wins.

welll, for me, i think this is the bisnes way, maybe EU ppl not used to it
but heck, tats life

remember that EC successfully forced Microsoft to sell versions of windows without built in Window's MEdia Player and Internet Explorer go figure

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Added on July 7, 2007, 4:46 amUpdate:

http://www.videobusiness.com/article/CA6458096.html

By Paul Sweeting -- Video Business, 7/6/2007

Paul Sweeting is editor of Content Agenda

WHAT IS IT about Blu-ray backers that they can't seem to shake the interest of anti-trust investigators?

Right before the July 4th holiday in the U.S., the Wall Street Journal broke the news that investigators for the European Commission, the executive arm of the European Union, have stepped up their probe of Blu-ray and HD DVD.

According to the report, the investigators sent letters in mid-June to the Hollywood studios seeking files, e-mails and phone records relating to their decisions to back one or the other of the new high-def disc formats. The companies were given until July 6 to reply.

The latest request for information comes roughly a year after the EC first started fishing around about Blu-ray and HD DVD.

In July 2006, investigators also sent letters to the studios seeking information on how they came to decide to back one format or the other. That inquiry seemed to go quiet for awhile, but clearly hasn't gone away completely.

In fact, investigators' interest seems to have grown keener and to have narrowed its focus to Blu-ray.

According to sources "familiar with the situation," cited by the Journal, investigators seem particularly interested in statements made by some Blu-ray executives at the Consumer Electronics Show in January regarding certain studios' exclusivity to Blu-ray.

In their formal request to one studio, the Journal reports, investigators sought information about the studios' decision to release movies exclusively on Blu-ray and not on HD DVD. The request also asked for records of any communications regarding both formats with certain "individuals associated with Blu-ray."

IF THE EUROPEAN Commission's interest has indeed narrowed to Blu-ray, it would not be the first time those behind that format have attracted attention from anti-trust investigators.

Back in 2004, the U.S. Department of Justice made preliminary inquiries into purported efforts by members of the Blu-ray group to use their voting power in the DVD Forum collectively to thwart development of the HD DVD format.

At the time, there were widespread reports that Sony, Matsushita and Panasonic, in particular, used their positions on the DVD Forum steering committee to deny HD DVD-developer Toshiba the absolute majority it needed to pass resolutions, by abstaining from voting.

In fact, the Justice Department's interest in the actions of the Blu-ray group likely predated the information request in 2004, largely thanks to the efforts of Warner Home Video, which at the time was a strong supporter of the HD DVD format and had complained to Justice officials about Blu-ray's actions as early as 2002.

Warner ultimately dropped those complaints, and the department's investigation fizzled out.

But even that investigation was not the first time some of the same Blu-ray companies drew scrutiny from anti-trust regulators.

Back when the original DVD format was being developed, two rival systems were also vying to become the industry standard, in a competition that also pitted Sony and Philips against Toshiba and Time Warner.

The Sony/Philips entry was called Multimedia CD (MMCD), and relied on the same physical disc format as an audio CD, for which Sony and Philips controlled the majority of patents.

Investigators wanted to know whether Sony and Philips were misusing their dominant patent portfolio in the CD arena to induce other companies to support MMCD over the Toshiba/Time Warner system.

The investigation only ended when Sony's then-new president Noboyuki Idei decided to throw in the towel on the physical format rather than face an escalation in the case.

IT'S HARD TO know what-if anything-to make of this history. No regulatory authority has ever charged any of the companies involved with wrongdoing, and it's certainly not unheard of for companies to push the edge of the competitive envelope.

But the constant scrutiny can certainly complicate matters for companies trying to do business with the targets of government probes.

The studios have no doubt already spent considerable sums on lawyers to collect and review all the documents requested by the EU investigators, and they can't be certain that the latest round of requests will be the last.

Those unbudgeted costs are also being incurred at a time when the revenue coming in from high-def releases is tiny.

So far, the studios seem to be treating the added burden as an acceptable cost of doing business in anticipation of a bigger payoff down the road.

That could change, though, if the EU investigators were to start taking depositions.

Much of the Blu-ray camp's current spin regarding their format's inevitable triumph would no doubt become the subject of long and painful questioning under oath, while piling up more legal fees and consuming executive's time.

At that point, you'd better be doing enough business to justify the costs.



This post has been edited by g5sim: Jul 7 2007, 04:46 AM