A few nanoseconds after Warner announced their switch to Blu-ray, rumors started flying about a payoff. This is unsurprising, as Paramount and DreamWorks Animation have been widely reported as having been paid up to $180 million to switch to HD DVD. Not necessarily in direct payments, but in commitments for marketing funds, etc. As Warner is much larger than those studios combined, the rumored payoff amounts were similarly larger – in the $500 million range. But, according to High-Def Digest, in a post-announcement conference call this afternoon, Warner Home Entertainment President Kevin Tsujihara flatly denied that there was any payoff.
“The packaged media business is a $42 billion dollar business worldwide at the retail level, and we [Warner] have the largest market share of anybody,” said Tsujihara. “From our perspective, the most important piece of this whole puzzle is, “How do we get growth back into this category?” That far outweighed anything else.”
This [decision] was one hundred percent around what makes the most sense for the consumer, the retailer and the industry. This was not a bidding war. This was all about what was best, strategically, for us.”
Personally, even if there was a payoff, I don’t have a problem with it. That’s business. I don’t blame the HD DVD camp for buying loyalty either. That’s also business. It happens all the time, very few alliances happen in the business world without some financial compensation being involved.
In related news, Warner says their announcement does not cover New Line, HBO, or BBC titles, and that those studios will make their own decisions, likely soon.
