Microsoft has doubt's about Blu-ray's disc capacity

Maintaining low production costs is a critical factor, which has been a key HD DVD talking point in light of current revelations about factory upgrade costs for Blu-ray. "For a long time, we actually thought that the Blu-ray Group had the upper hand in costs," Ribas said, mainly because of the involvement in Blu-ray of most of the major Japanese CE manufacturers - Sony, Matsushita (Panasonic), Pioneer, and Sharp - as well as Philips. Here is where recent events played a critical role: In a development that was brought to light only this morning, two of the world's leading China-based DVD player production facilities announced their support for HD DVD over Blu-ray. In press statements, these companies cited the relative openness of the DVD Forum compared to the Blu-ray Disc Association. "Now that we see China embracing HD DVD," said Ribas, "we actually see that on the cost side, HD DVD will have an advantage, because the Chinese have been the ones who have lowered the prices, via the competition, for HD DVD players." As much as 75 percent of DVD players sold in America today come from China, he added.

Maintaining low disc replication costs affects the consumer price for media, said Ribas, which would play into any price/performance evaluation. A disc production factory can make minor upgrades to its equipment, he stated, with the result being equipment that can produce both conventional DVD as well as HD DVD. Citing figures circulating this week throughout the industry, Ribas said it would cost as much as $1.7 million per production line to install Blu-ray disc production equipment, and as much as $2.0 million for each new mastering system installed. That's a significant expense, he explained, for a business which only turns over a 10 percent margin.

The surprise entry in Microsoft's and Intel's list of failures is disc storage capacity. On paper, Blu-ray appears to have the advantage. But the two companies looked beneath the paper: Capacity, said Ribas, "used to be the biggest advantage of Blu-ray, and we believed it. We thought, they'll get 50 GByte BD-ROM discs working, but it's not happening, and it's nowhere in sight. There are not even pilots. It's only in the lab that they are building these discs." With regard to demonstrated capacity, he told us, HD DVD-ROM actually leads BD-ROM by a score of 30 GByte to 25 GByte.

The final entry is interactivity standards. Although Microsoft and Disney jointly developed the iHD interactivity layer, based on XML - which is the glue that holds together the "Vista vision" of Microsoft's future Windows platform - and even though Disney is a Blu-ray proponent, the Association chose instead to endorse BDJ, an implementation of Sun-s Java Mobile Edition. Ribas told us that the major studios - either publicly or quietly - are opposed to BDJ, citing its relative complexity and its lack of compelling new features compared to iHD. An optional commentary track for videos, for example, that superimposes the speaker's image on-screen as well as providing audio, is one key iHD feature that BDJ will support only as an option, maybe. "Which means nobody will use it," said Ribas.

"Intel was looking at similar issues," said Ribas, "and [we] realized, 'We are getting very close to getting these things into the market, we have to stop hoping or expecting or believing promises. We have to look at what's real and what's not.' That's where our decision came from."

Ribas told us more about his and his company's expectations for the future of video disc technologies and interactive media in general. Stay in touch with Tom's Hardware Guide for more of our interview this afternoon with Microsoft's Jordi Ribas.

Tom's Hardware Guide has contacted the Blu-ray Disc Association early Tuesday for comment on today's developments. So far, the organization has not responded to our inquiries.