Warner, LG embrace dual-format DVD technology

LOS ANGELES (Reuters) - An electronics company and a movie studio independently rolled out plans on Thursday to bridge the divide between rival high-definition DVD formats with products that would combine two sets of standards.

Time Warner Inc. <TWX.N> said it will unveil a new high-definition disc that would hold recordings in the rival HD DVD and Blu-ray formats in separate layers.

Warner Bros., a movie studio division of the world's largest media company, plans to present the new disc, Total HD, at the annual Consumer Electronics Show in Las Vegas.

At the same time, South Korea's LG Electronics Inc. <066570.KS> said on Thursday it would launch a DVD player that supports both Sony Corp's <6758.T> Blu-ray format and HD DVD, which is backed by a group led by Toshiba Corp. <6502.T>.

Fears of a format war in a nascent industry widely expected to become a multibillion dollar market has slowed consumer acceptance of next-generation DVDs, analysts said.

The consumer electronics and entertainment industries are hoping the high-definition formats, which provide better picture quality and more capacity, will respark the slowing $24-billion-a-year home video market.

But the competing formats have been blamed for hindering sales of high-definition movies and players, with consumers recalling the bruising war between Sony's Betamax videotape and JVC's VHS version. JVC is owned by Matsushita Electric Industrial Co. Ltd. <6752.T>

LG's dual-format high-definition disc player will be introduced in the United States in early 2007, the company said in a statement. It did not provide further details.

Blu-ray says it offers higher capacity while HD DVD says it offers a cheaper system which is compatible with the current DVD standard.

Warner's Total HD movies will carry movies that can be played on DVD players that use technology backed by Blu-ray as well as the HD-DVD format.

Gerry Kaufhold, analyst with In-stat, a market research firm based in Scottsdale, Arizona, said the introduction of dual discs and players that play both formats would be good for both camps.

"If HD-DVD and Blu-ray could co-exist and various companies continue to make money from their patents for both, then both formats should continue to venture forward," he said.

"I think it's a good thing. It means that eventually any disc will play in any player and it almost diffuses the whole battle," he said.

Kaufhold predicted, however, that eventually there would be fewer players aligned with just one format.

"It may be that you won't need either HD-DVD or a Blu-ray specific players, because you will just buy multimode players," he said, but added, that backers of each format would still derive licensing fees.