40 Days #10: Grow a spine and back a next-gen optical format - for storage

HD DVD seems to be just about dead. Toshiba is said to be this close to abandoning their own baby. Over the last month, Netflix, Best Buy, and Wal-Mart have decided to back Blu-ray, effectively making Sony's format the de-facto next-gen optical movie format. I'm sure Sony is cheering, while Microsoft isn't all that thrilled, even though they can put on a brave face and claim that they offered their customers choice, didn't force a specific format on them, and downloadable movies are the future anyway - and they have that covered with the Xbox Live Marketplace.

I am still not really convinced that Blu-ray won't eventually be either ignored by consumers who think regular DVDs are good enough, or made irrelevant by on-demand offerings from cable companies, or even Apple with its Apple TV product. However, what worries me is why HD DVD lost and Blu-ray won. It wasn't because the PS3 included Blu-ray, but rather because the Xbox 360 didn't include HD DVD.

Ironically, by not including a built-in next-gen optical drive but rather giving their customers "choice", Microsoft ultimately took that choice away from them. The Catch-22 is that if only Microsoft had included the HD DVD drive, there would be many millions of HD DVD players out there, and the studios probably wouldn't have dropped their support. Of course, if they had included the drive, the 360 would have been a lot more expensive and thus would have sold a lot fewer of those millions. Sony took a risk and got criticized for it. Microsoft didn't want to bet on a format that wasn't quite completed yet. I guess that's like waiting for 802.11n to be finalized rather than including a draft version and making money for years before, even though there is a risk of future incompatibility.

Of course, Microsoft claimed that they supported the format, and even released the optional HD DVD drive, which probably sold decently well, given that it was a pricey external accessory. However, that wasn't really firm support of the format. Toshiba was really championing it, releasing a lot of standalone players and laptops with HD DVD drives, but Microsoft sort of stood on the sidelines and "supported" the format from afar. I guess now we will never know if there really was the rumored "ultimate" Xbox 360 which featured the HD DVD drive and could have been unveiled at CES, had the last-minute studio snub not taken place. That doesn't matter anymore.

What does matter is that the next Xbox will probably not be released before 2010-2011. That is three years from now. Even today we already have three-disc (Blue Dragon) and four-disc (Lost Odyssey) games - both from Microsoft, who is currently probably the only publisher with the sheer balls and resources to put out a multi-disc 360 title. Despite the issues with slower disc read speeds, PS3 developers can easily bring out a 7 GB game, a 22 GB game, or anything in between. What happens when the next open-world Burnout doesn't fit on one DVD? Or the next GTA? Those types of games - which  dynamically stream content as you move through the open game world - cannot be developed across multiple discs. So what happens when a multi-platform developer sees that there is enough of a PS3 installed base, and decides to push the technology as far as they can, even if that means cutting out the less fortunate gamers - the ones without a high-capacity optical disc? You know, just like Burnout Paradise ditched the 360 users without hard drives when playing online.

It worries me that Microsoft is in a tight spot now. Can they last the next three years with just regular DVD for storage? And then what, what will the Xbox 3 use? I doubt flash memory will be cheap enough yet, even three years from now, so we probably won't see games on 64 GB SSD cartridges. And there doesn't really seem to be anything else currently available on the optical side, apart from HD DVD and Blu-ray. Would Microsoft ever license Blu-ray from Sony, and probably somehow pay royalties on every disc, making Xbox 3 games inherently more expensive than their PlayStation counterparts? I doubt it. Even if it's just for spiteful pride reasons.

Once HD DVD finally dies as a viable movie disc format, I wonder if Toshiba will just kill it off completely, or keep it - as some have speculated - as a higher-capacity optical disc for PC users. Neither HD DVD nor Blu-ray have yet completely caught on in that area, probably due to high media costs and a lack of cheap and widely available recorder drives. Apple hasn't declared its allegiance yet either, although it is expected that it will side with Blu-ray, since it has existing ties to Hollywood. This could end up just like the the DVD +/-/R/RW/ROM "war" that confused many customers - including myself - for years. If HD DVD does gain traction as a data storage medium, there is a chance that Microsoft could use it in the Xbox 3 as a sort of proprietary game disc format, all the while "cutting" movie playback functionality from the console - like Nintendo does all the time - since it wouldn't play the "standard" Blu-ray movies.

However, for that to happen, Microsoft would need to step in now and bail out HD DVD by announcing their firm support as their next-gen game disc format or something along those lines. They potentially could try starting to use it within this Xbox generation, but even if it didn't raise the price of the console, it would fragment the market even more than the optional hard drive does now - and Microsoft already gets enough flak for that. And of course, no sane publisher would create games that would require more development time and resources, yet would only be playable on a fraction of the installed base.

Or Microsoft could just take all the billions earmarked for buying Yahoo, and do a one-for-one swap of each console in the market for a newer one with an HD DVD drive. But somehow I don't see that happening. At any rate, Microsoft needs to do something soon. Games are getting larger, Sony is gloating over owning the industry's new movie disc format, and the messy state of the Blu-ray spec is forcing all smart Blu-ray fans to buy PS3 consoles instead of other standalone players, since it is currently the only player that will probably survive all of the forthcoming feature updates as the Blu-ray format matures.

Come on, Microsoft, save HD DVD! Do we need T-shirts with the slogan?