While Toshiba officially pronounced HD DVD dead back in February, movies have still been available from Netflix for users to rent. But not anymore, well, not after December 15, 2008 anyway. Effective December 15, 2008 HD DVD will no longer be available from Netflix, any HD DVDs still in your queue will automatically be converted to DVD. Just one more reason to switch to Blu-ray.

Toshiba got its hindquarters handed to it in the HD DVD / Blu-ray format war, and that had to sting. But while all of the other HD DVD backers have sucked it up and moved on to embrace Blu-ray (even Microsoft has announced they’re adding native Blu-ray support to Windows, I hear hell had a run on ice skates), Toshiba just seems to have dug in their heels and is acting like Blu-ray doesn’t exist. If HD DVD couldn’t win, fine, then they’ll just put out high end DVD players. I didn’t know multinational corporations could be so Emo.

So today Toshiba dropped a press release entitled Toshiba ‘Breathes New Life’ Into DVD with XDE™ Technology. XDE stands for eXtended Detail Enhancement, which to me sounds like nothing more than upscaling with fancy edge enhancement and color contrast adjustment. Frankly it sounds like crap to me, based on the press release.

XDE Flexibility

In addition to upconversion from 480i/p to 1080p, XDE technology offers consumers the ability to customize their viewing experience to their liking with its picture mode settings. With these three selectable settings — Sharp, Color and Contrast — users can get the most out of their DVD movie-viewing experience on their terms.

– Sharp Mode offers improved detail enhancement that is one step closer to high definition. Edges are sharper and details in movies are more visible. Unlike traditional sharpness control, XDE technology analyzes the entire picture and adds edge enhancement precisely where it’s needed.

– Color Mode makes the colors of nature stand out with improved richness. Blues and greens are more vivid and lifelike. Color Mode combines the improvement in color with the detail enhancement of Sharp Mode and is ideal for outdoor scenes.

– Contrast Mode is designed to make darker scenes or foregrounds more clearly visible without the typical “washing out” that can occur with traditional contrast adjustment. Recommended for dark scenes where detail may be difficult to notice, Contrast Mode is also combined with Sharp Mode to provide a clearer viewing experience.

So ‘Sharp Mode’ cranks up the edge enhancement. But too much edge enhancement is one of the most common complaints videophiles have about many titles. This is the kind of cheap trick studios use to try to make an image ‘pop’, but it is unnatural. And now your DVD player can do it to all of your discs. Yay?

‘Color Mode’ sounds like it just tweaks the color palette to favor blues and greens, which can certainly make an image seem more vivid, but artificially so. This is the same kind of trick box stores use to make images on HDTVs look more striking on the wall of screens. And also why the first thing you should do is calibrate your TV, because the settings it comes with are great for selling the set in the store, but not for accurate color reproduction at home.

And ‘Contrast Mode’ cranks up the contrast. But if the contrast isn’t there in the source material, then it must be artificially boosting and/or suppressing some of the picture to increase the contrast. It all sounds like a high-tech, fancy way of doing what people used to do with the color, tint, and contrast knobs on old TVs - and the menus that replaced them on new TVs. This doesn’t sound so much like ‘breathing new life’ into DVD as it does ‘putting DVD in an iron lung’.

You know what these remind me of? Those silly audio modes most receivers have. You know, like ‘Concert Hall’? The settings that mess with the sound to supposedly recreate the feeling of a different space, but in reality are about as close the the real thing as Froot Loops cereal is to real fruit. The snozberries taste just like snozberries!

Sure, I’m just basing this off their press release and I haven’t seen it for myself. But even if they’ve been remarkably clever about the technology, it doesn’t change the fact that they’re just upscaling DVDs and tweaking the picture to try to make it look better. They’re just putting lipstick on a pig compared to real HD media like Blu-ray. No matter how you slice it, the best DVD can provide is one-sixth the raw pixel count as Blu-ray. And no matter how clever your algorithms are to interpolate the data, you just can’t recreate what isn’t there to start with. You can never start with a 480p source and upscale it to 1080p and match a native 1080p source.

So who is going to buy XDE players? People with extensive existing libraries of DVD you say? I have many hundreds of DVDs myself. But Toshiba is selling their XD-E500 1080p/24fps Upconverting DVD player, their first XDE-equipped player, for $149.99. Now, it also handles MP3 and WMA music playback, JPEG display, and is DivX certified, which is all well and good. But you can get a non-XDE player with all of those features (1080p24 upscaling, MP3/WMA, JPEG, DivX), for $50-$60. I myself have a Philips unit I picked up a while back from Amazon for around $60 which has those features, plus known codes to enable region free playback, and it handles NTSC< ->PAL. The Toshiba is unlikely to have either of those features. So is XDE worth the extra $90-$100? Or even $50 if the player is that much cheaper online? Will XDE and the Toshiba logo on the box convince people to pay double what they can get another unit for?

I doubt it will for the majority of users. Any improvement can only be just so good, and you’d need a good HDTV to really get the full benefit. And that’s after you manage to educate users on just what XDE is. When someone in standing in their local Best Buy, comparing units on a shelf, and the only differences are the brand, the price, and that the Toshiba has ‘XDE’, you’ve got an uphill battle on your hands to educate the user on what XDE is and why they want it.

So you’re really after users who are willing to spend more for a (supposedly) better quality picture. But then the users most likely to be willing to shell out more for such improvements are the very same group most likely to be willing to shell out for a Blu-ray deck. Entry level, current model decks are under $300 now, closer to $250 in some cases. And existing stocks of last generation units can be had for less than that. Even some of the best of the current models, with bells and whistles like BD-Live, are between $350-$400. And those prices are falling as supply and competition both increase, and component costs decrease. Entry level units should be under $200 by the holidays, with some well-equipped units under $300.

So where does XDE fit? Users who are just slightly more demanding than a non-XDE DVD player, but not demanding enough to go for even a low-end Blu-ray deck? All Blu-ray decks are also DVD players, all upscaling as far as I’m aware, most quite good at it, some very, very good. Once a person is willing to spend more money on the player, beyond the glut of sub-$100 upscaling players, they’ve already taken the first step toward being willing to make the jump to Blu-ray. It seems like XDE is there just to try to catch those who don’t quite jump high enough to clear the bar. I can’t believe that’s a big market.

The DVD player market is a commodity market now, even for nice upscaling players. It is getting such that there are fairly decent DVD players that cost less than some new release DVDs. Buy a movie, get a free player. That’s a joke, but sometimes it seems like that’s the next step. Toshiba is trying to be the odd man out, and they seem to think XDE will distinguish them from the hordes of commodity players. Enough that users will pay their higher prices. I don’t think it is going to be a big win for them.

Toshiba’s HD DVD decks were very nice units with some great features. They could easily have used the same platform as the basis for a Blu-ray player development. And now is the time (well, six months ago was the time) to get some nice BD players out and make revenue on them. In 2009 when the wave of Chinese BD players hits, there will be a lot of downward pressure on player pricing, making the market less attractive to ‘premium’ brands like Toshiba. That happened in the DVD market years ago. Instead of chasing yesterday’s market long after it has been commoditized, Toshiba needs to go after the marker’s of today and tomorrow, where the margins are higher and competition is lower. I really think it is just their corporate pride and stubbornness which keeps them from embracing Blu-ray.

The full press release:
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While Toshiba officially called HD DVD dead back in February, the technology has lingered on in China. Before the end of the format war, Toshiba had begun working on ‘CH-DVD’, a special version of HD DVD for the domestic Chinese market. And this effort didn’t die with HD DVD, instead it has been renamed CBHD - China Blue High-definition Disc. Now the first CBHD devices are coming to market with Shanghai United Optical Disc establishing the first CBHD disc pressing production line, and multiple players slated for retail, according to DIGITIMES. However, the format currently lacks any major studio support. It seems that, at best, it may receive domestic support.

Of course, the BDA hasn’t just been standing by while this happens, shortly after CH-DVD was announced the BDA announced that they too were considering the Chinese codecs. And taking it a step further, unlike CBHD, which is a ghetto standard restricted only to China, the BDA is considering adding the codecs to the global Blu-ray specification.

And, despite predictions from HD DVD fans that it would ‘never happen’, the BDA has approved several Chinese CE vendors to produce Blu-ray players. And even more players have been announced recently at SinoCES. With most of their major CE vendors cranking out Blu-ray players for the growing global market player availability will rise, while unit costs fall. With a limited domestic market, CBHD will have a hard time competing with the falling BD player costs.

DIGITIMES cites lower costs as the main advantage for CBHD over BD. An existing DVD line can be converted to press CBHD for around USD$800,000, while establishing a new BD line costs around USD$3,000,000. And the licenses required to produce a CBHD player are around USD$8.10, reportedly much less than the equivalent BD licenses. However, a BD production line can take orders for export discs as well, making it easier to keep the line busy - and making money. A CBHD line is only good for domestic disc pressing. And the licensing costs for BD are expected to drop sharply in the coming years. Plus a production line can be shared between domestic and export players, spreading the non-licensing overhead costs over a larger production base.

If the BDA can complete the China-ized version of the BD specification to receive Chinese governmental approval for the format, it should easily squeeze CBHD out of the market just as it did to HD DVD.

Picked up via EngadgetHD.

Following in the footsteps of Wal*Mart, Best Buy, and Circuit City, Amazon is also extending an olive branch to those who purchased an HD DVD player. If you purchased your HD DVD player from Amazon on or before February 23, 2008 you should be receiving a $50 Amazon credit. Be on the lookout for this email:

Dear Amazon.com Customer,

As someone who purchased an HD DVD player from us before February 23, 2008,* you might like to hear about a special offer available from Amazon.com.

New technologies don’t always work out as planned. We at Amazon.com value our customer relationships more than anything and would like to support customers who purchased these players by offering a credit good for $50 off any products sold by Amazon.com.** Just use promotional code XXXXXXXXXX when checking out. The code is valid through April 9, 2009, so you have plenty of time to use your credit. Purchases from third-party merchants on our site are not eligible.

* On February 23, 2008, the last manufacturer of HD DVD players announced it was ceasing production of those players.

** Offer cannot be used to pay for special-order titles, e-books or downloadable e-content, wireless service plans, gift certificates, gift-wrap, taxes, or shipping and handling charges. $50.00 promotional credit is per HD DVD player purchased prior to February 23, 2008–up to 10 units for a maximum credit of $500.00.

Picked up from EngadgetHD.

Joining Best Buy and Circuit City, Wal*Mart is offering an olive branch for the suckersunfortunates who were left with an abandoned format when HD DVD threw in the towel. Wal*Mart will allow you to return your HD DVD player for a refund - if you purchased it after November 1, 2007 and you have the original receipt. Returns must be made by April 30, 2008, and you don’t need the original packaging - just the unit and receipt. SlickDeals.net has the internal Wal*Mart memo about the returns, you may want to bring that along just in case your local store resists the return. Specifically eight models are being accepted for return, the UPCs are listed in the memo.

From SlickDeals and the WSJ, by way of EngadgetHD.

This week’s Nielsen VideoScan numbers from Home Media Magazine show that, for the week ended 3/30, HD DVD faded to 16% of the high-def market, with Blu-ray at 84%. That puts them at 67/33 since inception. But more interesting is that Blu-ray took 8% of the general market, to DVD’s 92%. That’s up from 6% last week. The growing number of day-and-date Blu-ray releases and increased player sales should see Blu-ray continue to gain market share.

A small change in Home Media Magazine reflects the much larger change in the batter for home video. The Nielsen VideoScan pie-charts, which used to show BD vs. HD DVD for the week ended, year-to-date, and since inception now show BD/HD DVD for week-ended and since inception - and the third box is now BD vs. DVD market share for the week ended. For the week ended 3/23 Blu-ray took 88% of the market, to HD DVD’s 12%. With the last of the HD DVD exclusives gone, and an increasing number of small studios canceling their remaining HD DVD titles, the HD DVD percentage should fall off to zero fairly quickly now. Since inception, BD has taken 67% of the market.

The new BD/DVD chart only compares the top 20 titles by unit volume for each format, but BD has 6% of the market to DVD’s 94%. That may not sound like much, but it is pretty good for a fledgling format just coming off the end of a format war that slowed adoption. As more and more major releases hit Blu-ray day-and-date, especially once Universal, Paramount, and DreamWorks Animation start their BD releases, that percentage should rise steadily - give or take a bit each week for variation.

This issue has a lot of BD coverage - the entire front page is BD-related articles. New releases are seeing an increasing percentage of sales on BD. No Country for Old Men saw 9.8% of sales on BD (the rest on DVD), while Hitman saw 12.6% of sales on BD. That compares to levels of 2-3% for most titles during the format war. With the spike in BD growth, one of the articles examines the issues replicators are facing in adopting to BD demand. The up-front investment in a BD production line runs from $1.5 to $1.7 million for a 25GB line to nearly $2.7 million for a 50GB line. Yields of usable discs is now up to around 75%, from only about half early on. But this isn’t dissimilar to what happened with DVD early on, and over time yields will increase and costs will decrease.

New research from Strategy Analytics predicts that Blu-ray will be in 30 million homes by the end of the year, and 132 million by 2012.

Hmm, Home Media Magazine wasn’t out on Friday as it normally is (I’m guessing due to the holiday), but I just checked it and it is up now. For the week ended 3/16 HD DVD took 22% of the market to Blu-ray’s 78%, putting them 76:24 year-to-date and 66:34 since inception. But with the last of the big studio HD DVD releases gone, the best HD DVD placed in the top 10 sellers was ninth, with American Gangster. Tenth also went to HD DVD, with Beowulf. Personally I was happy to see a niche anime title like Appleseed: Ex Machina placing fourth, and selling 12.27% of the volume of first place No Country for Old Men. I’ve read other reports that Appleseed moved roughly 30% of its volume on Blu-ray, the rest being DVD. (It placed 16th on the DVD sellers list.) Which shows that niche markets, like anime fans, tend to be early adopters - anime fans also jumped on LaserDisc and DVD earlier than the general market.