Sony CEO wants to go back in time, avert high-def format war
Customers aren't the only ones frustrated with the high-definition format wars—Sony CEO Howard Stringer is reaching the end of his rope as well. Blu-ray, which is backed by Sony, was doing well up until recently and winning …
Context & Ripple Effects
Howard Stringer's lament lands mid-arc in a war he did not start but now has to win. Sony spent late 2006 betting the PlayStation 3's launch on Blu-ray being the console's differentiator, making every console sale a vote in the disc-format contest against HD DVD. By June 2007 the company had framed its turnaround around that bet, with Stringer telling investors Sony was shifting to recovery mode while analysts argued both sides of the DVD war could lose if consumers kept hedging.
What changed by November is the scoreboard: per the article's framing, Blu-ray had been winning — Hollywood backers staged a two-day offensive in October touting triumphs and upcoming titles like Cars, Ratatouille, and the Die Hard films, and Sony confirmed a cheaper 40GB PlayStation 3 aimed squarely at Microsoft and Nintendo for the holidays. Yet a winning position still costs money and drags on, which is why Stringer's wish to unwind the war matters: it concedes that even the front-runner pays a tax.
First-order effects
- Sony's own holiday strategy now runs through the format war it wishes never happened: the newly launched 40GB PlayStation 3 doubles as the cheapest Blu-ray player on the market, so each price move is both a console play against Microsoft and Nintendo and a format-war salvo.
- Stringer's public frustration pressures HD DVD's backer camp as much as his own — if the side that is 'winning' wants out, the standoff's cost is now stated by a named CEO rather than inferred by analysts.
Second-order effects
- Studios and retailers holding dual-format release schedules face continued split inventory and marketing spend; the longer neither side blinks, the more their high-def margins subsidize a standards fight rather than sell discs.
- A prolonged stalemate pushes hardware makers to blur the line between consoles and disc players — Sony's pricing of the 40GB PS3 effectively prices Blu-ray into the gaming market, forcing Microsoft to answer on its own platform terms.
Third-order effects
- If buyer hesitation keeps widening — the scenario Business Week flagged when it warned both sides could lose — the industry drifts toward consumers defaulting to upconverting standard DVDs until one format collapses or the studios force consolidation.
- The episode hardens a lesson for future physical-media transitions: exclusive studio allegiances and proprietary hardware bets extend wars past the point of profitability, raising the odds that next-generation formats arrive with pre-negotiated cross-industry backing instead.
The trend: High-definition disc formats are locked in a war of attrition where even the leading side's chief executive treats victory-by-exhaustion as the realistic endgame.