Looking back we can recall a lot of format wars in the IT industry. The VHS vs. Betamax in the video casette recorders is one of the most famous ones. The DVD-R vs. DVD+R calmed down quite quickly as all drive manufacturers now support these two formats in parallel.
Behind this 'sudden' urge to find a peaceful solution must be the economics. Hostile competition is expensive. It is so expensive, that I can bring down even largest of companies. For an example, Yamaha was forced to step back from optical recording industry, even though it was one of the highest quality and most innovative manufacturers (read this). Instead of speding millions on marketing, lobbying, and price reductions, they seem to have chosen the peaceful way. There is plenty of cake for both of them, as we see from the DVD recordable market today. But customers usually benefit from the fierce competition via aggressive pricing. Now if Blu-ray and HD-DVD find a peaceful solution, will they be floating the prices high with common agreement, since there is no need beat the competitor on the free market?
Other key companies involved in the format war, including Matsushita's Panasonic and Netherlands-based Philips are also studying ways to end the three-year stand-off that is threatening to stifle the industry's growth.Source: Reuters
But sources close to the electronics companies said it was still early days, and that the discussions would take a long time, while adding that a positive outcome was not guaranteed.
"Discussions are taking place, but it's very complex, both in terms of technology but also because so many companies have a stake in this," one source told Reuters.
Written by: Lasse Penttinen @ 23 Apr 2005 0:05
