Microsoft Says Streaming Digital Content Will Kill Blu-Ray

Microsoft (Nasdaq: MSFT  ) , the supporter of the erstwhile HD DVD format, says digital streaming of content will cause Blue-ray's demise.

In an interview with Xbox360Achievements, Microsoft's, UK Xbox chief remarked: "Actually Blu-ray is going to be passed by as a format. People have moved through from DVDs to digital downloads and digital streaming, so we offer full HD 1080p Blu-ray quality streaming instantly, no download, no delay. So, who needs Blu-ray?"

He also stated that it was a wise decision to keep Xbox pricing low to be able to transition easily to providing digital content.

Microsoft has joined its competitor Apple (Nasdaq: AAPL  ) in withdrawing support from the Blu-ray format. In fact, Apple had been a bystander in the debate waiting for a standardized format to emerge from the HD DVD-Blu-ray format war. But with the launch of Apple TV, it buttressed its move in the direction of offering a device that integrated other devices that store and play digital content. Also, its iTunes is moving away from regular media towards streaming digital content.

Microsoft had joined major consumer electronics manufacturers, content providers and other companies as members of the HD DVD Promotion Group in 2005. Microsoft had been a powerful force in pushing for the HD DVD standard. The final nail on HD DVD's coffin was hammered by Toshiba, the main company behind the format, when it offered its own Blu-ray disc player in 2008.http:/img.ibtimes.com/www/site/us/images/1px.gif

HD DVD breathed its last when Warner Bros. declared that it would release movies only in Blu-ray disc in 2008, which created a domino effect with major retailers opting out of selling HD DVD.

With HD DVD's demise, the industry thought that Blu-ray technology would become the established format. However, the current trend where the traditional movie television segment is being reformed by integrated devices like Google TV and Apple TV that allows streaming of digital content to the TV will eventually cut into Blu-ray's dominance.

Blu-Ray format offers more than five times the storage capacity than a traditional DVD and can compress up to 25GB on a single-layer disc and 50GB on a dual-layer disc. It uses a blue-violet laser instead of the traditional red laser for reading. Since the blue-violet laser has a shorter wavelength (405nm) compared to red laser's wavelength of (650nm) it allows focusing the laser on a spot with greater precision, thus allowing data to be condensed tightly using less space.

It is currently backed by 200 of the world's leading consumer electronics, personal computer, recording media, and video game and music companies.

In a recent report by WSJ, electronic retailers confirmed having radically cut its extensive selections of movie and music discs citing increasing demand for digital content. It intends to use the freed shop-floor for showcasing other gadgets like iPads and smartphones.

With Netflix (Nasdaq: NFLX  ) planning to offer streaming-only plan confirmed by an issue of statement on its official blog, and with Google looking to leverage on cloud-based streaming content with an influx of devices like iPads and smartphones that will allow access to digital content, the future of high-density recording discs like Blu-ray is sure to be challenged.

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On September 24, 2010, at 1:26 PM, jazzdrive3 wrote:

    Not anytime soon, in the States anyway. True HD streaming is still niche, and a good thing too. The infrastructure couldn't handle everyone and their mom streaming 10 GB movies every night.

    And no wait? Please. The standard def streaming from Netflix still chokes up my broadband connection every once and a while.

    It isn't the future quite yet.

  • Report this Comment On September 24, 2010, at 1:27 PM, jrmart wrote:

    Apple separates itself from the competition by introducing state of the art products like the IPHONE4, IPAD and Apple TV, a product Steve Jobs considers a sideline hobby. Please note that none of these products offer DVD or BluRay drives. Apple uses push technology to keep everything (emails, photos, videos, calendars, movies, web favorites, etc.) in sync across your iPhone, iPad, Mac, PC, and the web WIRELESSLY, so no matter where you go, or which device you use, all your information is up to date — WITH NO DOCKING REQUIRED. The combination of ITUNES and ME.COM, Apple's Cloud Computing, separates Apple from the rest of the limited syncing ME TOO product companies. Don't be fooled, Steve Jobs' hobbies like Apple TV usually turn out to be market changing events. Apple already announced that they will use NETFLIX to stream HIGH DEFINITION movies to their new APPLE TV, IPHONE4 and IPAD. Lots of my family members and neighbors use to buy movies on BluRay disks. Most of them have now switched to a streaming NETFLIX monthly plan. The world wants High Definition, simplicity and convenience. When I get home after a long day at work, I just want to grab my remote and push a button to see a movie and I certainly don't need to own an expensive and soon to be obsolete BluRay collection of movies.

  • Report this Comment On September 24, 2010, at 1:39 PM, maximus9 wrote:

    Netflix will grow quickly as the company extends its footprint overseas. Jim Cramer says, enough for Netflix to reach “two or three times its size once it starts growing internationally.”

    Netflix’s $8.2 billion market cap just doesn’t measure up to the company’s true value. With increasing market share, I feel Netflix stock has lot more room to grow.

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