As HDTV Prices Fall, Manufacturers Create DVD Format War

LAS VEGAS The consumer electronics industry just has to keep things interesting. Just as it's on the verge of meeting one of its toughest goals -- making high-definition television an affordable commodity -- it has to tackle new ones. And if these guys can't find any, they'll make up new ones.

Even if that means gearing up for an ugly, pointless, expensive format war.

That impending mess overshadows a remarkable development at the Consumer Electronics Show here: While a lot of flat-screen HDTVs are still marketed and sold as luxury items, many more now cost no more than a high-end desktop computer.

For instance, a plasma or LCD screen measuring 40 inches or so would have gone for $4,000 or more a year ago. Now a name-brand manufacturer like Samsung expects the same screens to go for $2,500 this spring. Smaller screens go for still less; Sharp should have a 26-inch LCD going for about $1,000.

With so many of these flat-panel displays presented at the Las Vegas Convention Center's seemingly endless floors, only comically large prototypes on display can draw much of a crowd--for instance, the 103-inch monstrosity spanning a good chunk of a wall in Panasonic's exhibit.

This represents the electronics industry at its best: It makes customers feel instantly richer when onetime luxuries like plasma TVs plummet into the realm of affordability. (Those who bought at the higher prices, however, may feel like chumps for jumping on the bandwagon too early.)

But this trend also means eroding profit margins to manufacturers, so many of them are trying to put their own, exclusive refinements on HDTV.

Many are touting sets that can display a broader spectrum of colors; where current models can handle about 70 percent of the colors theoretically available in a TV signal, these upgraded models exceed 90 percent -- 102 percent in the case of one LG LCD.

Philips, having introduced plasma sets last year that illuminate the walls on either side in colors programmed to match what's playing on the screen, rolled out new "Ambilight" models that do the same trick on the walls above and below the set. (These hues are supposed to enhance your enjoyment of the picture.)

The most popular HDTV "upsell" feature, however, is support for the highest possible resolution allowed by the HD spec, even though no broadcasts offer this "1080p" quality.

Instead, this highest-of-high-def quality will have to come from a successor to the DVD (which only eight years ago was an upstart challenger to videotape). And if there was only one successor to the DVD, that might happen.

Instead, two camps of companies are going to market with two incompatible formats. One's called HD DVD and the other is called Blu-Ray. Both look tremendous in demonstrations. Both can store ludicrous amounts of information, anywhere from 15 to 90 gigabytes per disc. Both come in rewriteable versions that can be used to store data and video. Both are backed by powerful companies in the electronics, computing and entertainment industries.