Paramount "has HD DVD get-out clause"

Posted on 8 Jan 2008 at 09:11

Paramount is poised to deliver the final blow to HD DVD and switch back to Blu-ray, according to the Financial Times.

The studio and its Dreamworks and Lionsgate subsidiaries switched to HD DVD last August for a reported $150 million cash incentive. That deal was thought to tie the studio to the Toshiba and Microsoft-backed format for 18 months, but the FT says that the contract has a get-out clause which allows Paramount to switch back to Blu-ray if Warner Brothers dropped HD DVD.

That happened at the weekend and should Paramount exercise the clause, it would leave HD DVD with just one big-name backer, Universal.

Yesterday Toshiba remained bullish about HD DVD's future, but the HD DVD Association cancelled a press gathering planned for this week's Consumer Electronics Show in Las Vegas suggesting that it does not share the technology inventor's optimism.

That is bad news for the million or so people who have already bought HD DVD players and the not inexpensive movies to play on them. But there appears to be some hope that Blu-ray's main backer Sony is prepared to re-open talks with Toshiba with an eye to combining the two formats.

"We are not going to push people around. We'll talk to anyone," Sony chief executive Howard Stringer told the FT. "We have a lot of work to do to grow the market. We'll be systematic and open to dialogue at all times."

Author: Simon Aughton

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