Recordable DVD market muddied

In a move that could slow development of the market for recordable DVD drives, Sony, Philips, Hewlett-Packard, and several other companies are demonstrating a storage technology at the CeBIT '98 trade show that will rival other products about to reach consumers.

For the first time, the companies are publicly showing the DVD+RW drive, which will allow users to record data onto a disc, erase it, and then re-record on the same disc, similar to how a computer disk is used. The discs can store up to 3GB of data, in comparison to the 2.6GB that incompatible, single-sided DVD-RAM discs can store.

Final prototypes of the DVD+RW drives aren't expected to be ready until the fall. But DVD-RAM drives are likely to begin shipping to customers as early as next month from companies such as Hitachi and Matsushita Electric. Toshiba is expected to follow shortly thereafter.

Rewritable DVD technology could become the standard removable storage technology for the desktop, according to research firm International Data Corporation. Ultimately, though, the promise of re-recordable DVD technology may take longer to materialize as a result of consumer confusion about the competing technologies.

"Can Sony and Philips pull off the perception that they have a working drive [that competes with DVD-RAM]?" asked a skeptical Mary Bourdon, an analyst with market research firm Dataquest. "If they muddy the waters by claiming they have something that would take on DVD-RAM, that could stall DVD-RAM [adoption]," Bourdon said.

Sony, Philips, and HP will also have the backing of Mitsubishi Chemical, Ricoh, and Yamaha in their attempt to move forward with their recording technology.

The companies are risking confusion in the market for a number of reasons, some of which are based on business issues such as royalty payments, others related to differences in the technology. Philips has said that DVD+RW is more compatible with current CD technology and that the newest versions of DVD-ROM drives will be able to read DVD+RW disks with fewer costly changes than DVD-RAM.

Also, the technology is supposed to be "caddyless"--meaning that the disc doesn't have to be stored in a special enclosed tray to keep its recording properties. Supporters say this will help speed consumer acceptance of re-recordable DVD technology. At a demonstration at last fall's Comdex trade show, however, Sony said early versions of the drives are expected to use a caddy.

In the meantime, users are increasingly opting for CD-RW drives (the rewritable version of the CD-ROM) as a mass-storage medium. HP, Philips, Sony, and others are projecting that more than 6 million drives will be shipped this year, up from 2 million in 1997, and that 15 million units are projected to be shipped in 1999.