HD-DVD on the ropes?

The struggle for the high-definition optical disc successor to DVD has seen some key developments in the past few weeks--and most of it has been in the form of momentum for the Blu-ray format. announced on Thursday that the studio will be releasing its movies on big Blu as well as HD-DVD. As such, Warner is adopting the same neutral stance that Paramount--also a former exclusive backer of HD-DVD--adopted earlier this month. Theoretically, that means you should be able to get high-def versions of your favorite Matrix and Indiana Jones movies on Blu-ray or HD-DVD. In practice, though, it means the HD-DVD format--and its primary backer, Toshiba--is in a world of trouble.
Why? HD-DVD had--past tense--some key advantages over Blu-ray. Because HD-DVD media is said to be simpler to manufacture (it uses the same 0.6mm protective layer as standard DVDs), existing DVD production lines could be switched over to HD-DVD at comparatively little cost--according to Toshiba, that is. (Blu-ray backers point to improved manufacturing processes such as a "spin coat method" that they say will put the production costs of Blu-ray media on more of an even par.) Furthermore, HD-DVD hardware and software was scheduled to be available in the fourth quarter of 2005, getting the jump on Blu-ray hardware by at least half a year. And, of course, HD-DVD had a roster of exclusive content from Warner, Paramount, and Universal that you wouldn't be able to get on Blu-ray. Flash forward to the present day, and HD-DVD's claim to easier media manufacturing is the only supposed advantage left standing. Toshiba has officially delayed its HD-DVD hardware to the late first quarter of 2006--at the earliest--and Universal is the only major studio that remains an exclusive content partner.
In fact, HD-DVD's only good news of late may soon be reversed as well. Microsoft and Intel loudly proclaimed their loyalty for the Toshiba format last month, but HP has since requested the Blu-ray consortium to add two key standards to the format--managed copy (for sharing movies on a home network) and iHD (a Windows-friendly Microsoft interactivity scheme)--that, if incorporated, will likely mollify the Wintel duopoly's objections that the current Blu-ray format isn't PC-friendly. Losing those two giants to Blu-ray would be a bad omen--if not a death knell--for HD-DVD.
In my opinion, the deciding factor may well be the PlayStation 3. Sony, the major kingpin of the Blu-ray group, will be shipping the PS3 with a Blu-ray drive. Assuming the company delivers the console to North America relatively on time--before the 2006 holiday season--and at a price point that's below $500, even lukewarm sales will put Blu-ray players in the hands of millions of consumers. By contrast, HD-DVD decks are likely to cost upward of $1,000 and will likely be limited to a comparatively small audience of early adopters and high-def enthusiasts. C'mon--which one would you rather buy?