Paramount to Drop Blu-Ray High-Def DVDs

A Toshiba HD-DVD disc player is seen at a Ken Crane's Big Screen Headquarters store in Buena Park, Calif., in this Aug. 8, 2007 file photo. Paramount Pictures and DreamWorks Animation SKG announced Monday, Aug. 20, 2007 that they will offer next-generation DVDs in the HD DVD format rather than Blu-ray, a move that further complicates the race between the competing technologies. (AP Photo/Reed Saxon, file) (Reed Saxon - AP)

LOS ANGELES -- Paramount Pictures and DreamWorks Animation SKG Inc. will offer next-generation DVDs in the HD DVD format and drop support for Blu-ray, further complicating the race between the competing technologies.

Monday's announcement affects the upcoming DVD releases of the blockbusters "Shrek the Third" and "Transformers," along with movies distributed by Paramount Pictures, DreamWorks Pictures, Paramount Vantage, Nickelodeon Movies and MTV Films.

Movies directed by Steven Spielberg, however, will continue to be released in both formats.

Paramount, which owns DreamWorks Pictures and handles home sales for the separate company DreamWorks Animation, previously released movies in both Blu-ray and HD DVD.

"Part of our vision is to aggressively extend our movies beyond the theater, and deliver the quality and features that appeal to our audience," said Brad Grey, chairman and CEO of Paramount Pictures, a unit of Viacom Inc.

"I believe HD DVD is not only the affordable high-quality choice for consumers, but also the smart choice for Paramount," he said.

The competition between Blu-ray and HD DVD has kept confused consumers from rushing to buy new DVD players until they can determine which format will dominate the market.

Until recently, many consumers were able to defer the choice because players have been so expensive. But prices have been slashed by about half _ Sony Corp.'s Blu-ray player now sells for $499, and Toshiba Corp.'s cheapest HD DVD player sells for $299, with both likely to include as many as five free movies as an incentive.

Jeffrey Katzenberg, CEO of DreamWorks Animation, said consumers seeking to switch to high-definition DVDs will be enticed by the movies available for HD-DVD players. He added the lower price for the Toshiba devices will appeal to the family market.

"It's a game-changer, what they're doing, and it's why we decided to throw in with them," Katzenberg said.

Standalone HD DVD players have a bigger slice of the market than Blu-ray players. But when you count Sony's PlayStation 3 game console, which comes with a Blu-ray drive, there are more Blu-ray players in U.S. homes.

Rob Moore, president of Paramount Worldwide Distribution, said market data shows that people who own gaming consoles buy fewer movies than those who invest in a movie-only player.