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Friday, August 24, 2007
Blue-Ray Responds Strongly to Paramount/HD-DVD Deal

Blue Ray Technologies responded to news that Paramount and DreamWorks Animation have accepted $150 million to drop Blu-Ray distribution, a move that has sparked great controversy in the multi-billion dollar film and DVD industries.

The founder of the first and only indie Blu-ray factory in the U.S, Erick Hansen of Blue Ray Technologies, spoke out strongly about the reported $150 million in incentives Toshiba and the HD-DVD cadre gave to Paramount and DreamWorks Animation to shun Blu-ray discs.

Erick Hansen of BRT calls it an act of desperation by HD-DVD, which is in grave danger of losing the Hi-def format wars, as indicated by retailer and consumer preference.

"Toshiba and HD-DVD offered this deal because they are desperate. The public has chosen Blu-ray discs with their pocket books, buying BDs 2-to-1 over HD-DVDs this year," Hansen said.

"For retailers, it's like being forced to stock VHS tapes after the public chose DVDs," he added. "For the consumer it creates more confusion that hurts the industry-wide move to hi-def." Hanson noted DVD retail leaders Blockbuster and Target stores will only stock Blu-Ray on their shelves.

Studios including Sony, Disney, Fox and MGM are Blu-ray only. Warner Bros. remains dual format. Universal, and now Paramount, release videos in the HD-DVD format.

Hanson said he was far from alone in his opinion, citing two articles this week in the New York Times and dozens of other publications where the president of Disney Home Entertainment Bob Chapek stated "There is no longer any doubt that Blu-ray is the clear successor to standard DVDs," Chapek is widely quoted as saying. "(The Paramount deal) is not in the best interest of consumers."

"What has Paramount gained by accepting the money?," asked Hansen "If multi-billion dollar director Steven Spielberg and billion dollar director Michael Bay like Blu-ray, the deal is a double-edged sword. "Transformers II" and "Indiana Jones 4" are both billion dollar babies on their own. So why risk the ire of their most valued directors? If these two spoke up so quickly, you can be sure that there are a dozen others who will follow suit if they have the clout on a film."

Spielberg's films are specifically excluded from the Paramount-DreamWorks Animation deal, they will continue to be released in both formats, according to Paramount. Bay released a statement on his website over his displeasure of distribution of "Transformers" I and II to HD-DVD only.

"I would like to see others take a stand, this is only slowing the inevitable and hurting consumers and the business," Hansen said. "This seems like a move of desperation," said Andy Parsons, a member of the Blu-ray Disc Association, which represents companies like Panasonic, Samsung and Sony.

The New York Times and other media said Paramount and DreamWorks Animation together will receive about $150 million in financial incentives for their commitment to HD DVD, quoting two executives from Paramount parent Viacom, with knowledge of the deal but who asked not to be identified (

The incentives will come in a combination of cash and promotional guarantees. Toshiba will use the release of "Shrek the Third" as part of an HD DVD marketing campaign.

"It's not that I'm surprised they took the deal," Hansen concluded. "But it's like paying them not to grow crops. How is the film industry going to segue into the next-gen world if it accepts a relative pittance to stunt its growth?"

Hansen is founder of Blue Ray Technologies ( which has built the first U.S. indie Blu-ray plant in Spokane, WA. The $12 million plant also has HD-DVD capacity, but Hansen has chosen to support Blu-ray for reasons of quality, capacity, and market penetration.

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