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March, 4th 2008

Sony topper Howard Stringer tied a number of key initiatives, including the PS3, to Blu-ray's fate.
From Betamax to the MultiMedia Compact Disc to the Universal Media Disc, Sony found itself on a rather conspicuous winless streak when it came to launching homevid formats over the last few decades.
But the Japanese conglom's luck changed dramatically last month when rival Toshiba threw in the towel on HD DVD. That made the Sony-championed Blu-ray Disc technology the physical format of the future for home movie consumption.
For Sony, none of this came without huge risks.
Under CEO Howard Stringer and his "Sony United" strategy, nearly every division found a way to promote the hi-def DVD format.
The decision to include a Blu-ray player in every PlayStation 3, for example, is one of the prime reasons for the game console's high cost and its slow sales compared with the Microsoft Xbox 360 and Nintendo Wii.
But just as Warner Bros. has been richly rewarded with tech royalties for leading the charge in the development of DVD in the 1990s, Sony's triumph -- should Blu-ray achieve even half the success DVD has -- will likely also yield impressive spoils.
Most obviously, Sony has a plurality of the patent pool for the format, giving it a healthy margin on every Blu-ray movie and game disc sold.
In addition, it's one of the primary manufacturers of Blu-ray players and a producer of software via Sony Pictures. And success for the format could significantly up the value of the PlayStation 3 in consumers' eyes.
"Sony is basically the biggest player in the 'Blu-ray economy,'" says consumer electronics analyst Richard Doherty. "It builds the laser diodes made in many of its rivals' Blu-ray players. (And) Sony tools are used for title authoring in every Blu-ray production line."
But on a more esoteric level, staring down HD DVD competition that also included titans like Microsoft and Hewlett-Packard allows Sony to, perhaps, finally move on from Betamax -- the tape format that lost out to JVC's VHS as the 1980s' erstwhile homevid format of the future.
In fact, that catharsis might also extend to DVD. In the early '90s, Sony and Philips jointly developed a movie-disc technology called the MultiMedia CD, but they ended up abandoning the format and compromising with Toshiba on the DVD.
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