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Toshiba Concedes Defeat in the DVD Battle

By MARTIN FACKLER

Original article at http://www.nytimes.com/2008/02/20/technology/20disc.html?em&ex=
1203656400&en=78222a6d132307dc&ei=5087%0A

TOKYO — The biggest consumer electronic format war in a generation is officially over.

Toshiba, the Japanese electronics giant, threw in the towel on its HD DVD technology Tuesday, announcing that it would no longer develop, produce or market disc players for the format. In doing so, it ceded victory to Sony’s competing Blu-ray format, which now looks set to become the global standard for high-definition DVDs.

In a pitched two-year battle, Sony and Toshiba tried to woo Hollywood studios to release movies in their formats and to persuade computer and game console makers to use their disc drives. The struggle was reminiscent of the 1980s battle between the VHS format of Matsushita and Betamax from Sony to become the standard for videotape.

Toshiba’s chief executive, Atsutoshi Nishida, said the death blow for HD DVD came last month, when the movie studio Warner Brothers, a unit of Time Warner, decided to drop the format in favor of Blu-ray. He also cited a decision last week by Wal-Mart Stores not to stock discs and players using the Toshiba format.

“The sudden change by Warner Brothers was like a bolt from the blue,” Mr. Nishida said at a news conference at Toshiba’s headquarters in Tokyo.

He said Toshiba had already informed two of its biggest HD DVD partners, the studios Universal and Paramount, of its decision. Other partners included Intel and Microsoft, which sold HD DVD drives for its Xbox 360 game consoles.

Mr. Nishida said Toshiba would halt all production by the end of March, though it would continue offering customer support. He also said Toshiba had no plans to begin producing Blu-ray players.

On Tuesday, he announced that Toshiba and an American partner, SanDisk, would spend at least $16 billion to build two flash memory plants in Japan.

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