Netflix, Best Buy back Blu-ray

by Dan Gallagher

MarketWatch (MCT)

12 February 2008

SAN FRANCISCO - The HD-DVD format took another blow Monday as online video-rental giant Netflix pledged to offer high-definition DVD’s only in the rival Blu-ray format, and retailer Best Buy said it would recommend Blu-ray to its customers.

In a statement, Netflix said it based its decision on the fact that four of the six major studios are going give exclusive backing to Blu-ray, made by Sony. It plans to phase out its offering of HD-DVD disks, from Toshiba, by the end of the year.

The move by Netflix follows a similar move by rival Blockbuster, which announced its support of Blu-ray last summer.

Later Monday, Best Buy said it would recommend Blu-ray hardware and software as the “preferred” format for high-definition. The company said its decision was made to address “consumer confusion.”

“We believe our move to feature Blu-ray should help consumers feel confident in their hi-def content choices,” said Mike Vitelli, Best Buy’s senior vice president of home solutions, in a statement.

Best Buy said it would continue to “carry an assortment of HD-DVD products for customers who desire to purchase these products.”

Last month, Warner Bros. said it would back Blu-ray exclusively. The Hollywood studio arm of Time Warner had been offering movies in both formats. Walt Disney, News Corp.’s Fox and Sony Pictures were already backing Blu-ray exclusively.

Universal, owned by General Electric and Viacom’s Paramount unit remain in the HD-DVD camp.

“The prolonged period of competition between two formats has prevented clear communication to the consumer regarding the richness of the high-def experience versus standard definition,” Ted Sarandos, chief content officer for Netflix, said in a written statement. “Going forward, we expect that all of the studios will publish in the Blu-ray format and that the price points of high-def DVD players will come down significantly.”

Netflix said that the majority of customers who rent in high-definition format prefer Blu-ray titles.

The company said it will continue to offer its line of HD-DVD discs until their “natural life cycle” takes them out of circulation, but it will not buy new HD-DVD titles.