So it’s time for me to eat crow, or depending on your taste, humble pie. Not so long ago I was confidently predicting a drawn out battle between two high definition disk formats; HD-DVD and Blu-ray. HD-DVD, backed by Toshiba and the DVD standards body offered cheaper players but only a limited range of titles; Sony’s Blu-ray was more expensive but had a larger library of movies. It seemed likely that the two formats would continue to co-exist, confusing purchasers who would continue to vote with their feet and carry on buying DVDs. Suddenly everything changed; HD-DVD is dead. On February 19th, Toshiba announced that it would immediately stop manufacturing HD-DVD players and recorders. In little over a month, HD-DVD had gone from a viable format for the future of movies to a technological cul-de-sac. What had gone wrong?

Two factors conspired to kill HD-DVD. The first was Sony’s technological wonder, the Playstation 3, which comes with a built-in Blu-ray player. After a troubled launch, the PS3 has begun to notch up impressive sales with more than 10 million sold to date (more than a million in the UK alone) – ten times the number of HD-DVD players that were sold during its lifetime. People may not have bought PS3 for movies, but they have certainly been experimenting with Blu-ray disks whose sales have been steadily climbing. The second nail in the coffin of HD-DVD was the decision by Warner Brothers to cease issuing new movies on the format. This left only Universal Studios and Dreamworks as committed to HD-DVD exclusivity for their movies. Within days of the Warner announcement; Woolworths in the UK and the colossal American chain WalMart said they were abandoning HD-DVD; the writing was on the wall for the format.

In the US and Japan, many retailers are compensating purchasers of HD-DVD players, either with cold, hard cash or with credits against the purchase of a Blu-ray player. On the software front, things are grim for HD-DVDs with most studios cancelling future releases; but HD-DVD users are enjoying a fire sale of existing titles as retailers dump their stocks, at the moment disks can be had for as little as £6 apiece – cheaper than DVDs! Existing HD-DVD players will continue to play regular DVDs, and in the event of one failing, Toshiba has stockpiled at least 8 years worth of spare parts. If, like me, you bought into HD-DVD, you will be able to enjoy it for many years to come.

The backers of Blu-ray, most notably Sony and the movie studios, are the victors. Toshiba might have lost this war, but it can easily afford to write off the costs of HD-DVD. The real losers in this war may well be consumers, and that is because we’re going to have fewer ways of enjoying our entertainment.

Region coding is part of a trend in media and computer software known as digital rights management (DRM) that aims to control how media can be used. DRM allows the publisher of a title to say where it can be played, on what machines, if it can be copied to another device, even whether the recording will evaporate after being played. You’ve almost certainly encountered DRM every time you play a DVD. When you first put a DVD into a player you will see a number of warnings about where the disk can be used and the consequences for pirating its contents. You may have noticed you cannot skip past these and get on with the movie – the DRM on the disk temporarily disables the functions that allow you to fast forward and go to the next track. The DRM on the disk also prevents you from copying its contents and from playing disks bought in one part of the world from working inside the UK. You can find a map of these ‘region codes’ on Wikipedia.

The DRM on DVDs was introduced as a reaction to the threat of piracy. Older, analogue technologies – such as audio and videotape can be easily copied, but the process is slow and the number of copies that can be created is very small. Crucially, as tape is repeatedly duplicated, the quality of the copies decreases – effectively limiting the number of pirated copies that could be circulated. However, when information is stored in digital form – such as on a DVD – it can be perfectly replicated an infinite number of times. These perfect copies can then either be written on to a blank disk, or distributed across the World over the Internet.

DVD’s DRM is a fairly elderly technology known as the Content Scrambling System (CSS). It was broken long ago and pirated versions of DVDs, stripped of all their DRM (often without the infuriating anti-piracy adverts found on genuine disks), can be found in most towns and cities and circulating on the Internet. When movie studios began to plan the move to high definition disks, they chose more powerful forms of DRM. Blu-ray’s protection is called BD+ and is generally thought to be superior to the AACS system found on HD-DVD as it allows manufacturers to continually upgrade their DRM against attacks. Unlike HD-DVD, Blu-ray also uses region coding to stop users playing and importing disks from other parts of the world. It is widely believed that the movie studios put their weight behind Blu-ray because of its stronger DRM, both because it offered better protection from piracy, and because it served to block the traffic in cheap disks from places such as the United States and Hong Kong.

DRM is not only found on DVDs, it is used by games companies to protect their products, in satellite and cable set-top boxes, on most music bought from online stores, even in the expensive HDMI cables needed to connect to high-definition television sets. Although there are a huge number of DRM technologies being used by various companies, most of them share a common technological root known as encryption; a field of mathematics concerned with scrambling information to shield it from prying eyes. Crucially, encryption is always reversible – that is the scrambled material can be restored to its original state by performing a decryption. Media documents controlled by DRM are distributed in an encrypted form and can only be decrypted by a user if they own both a decryption program and a second piece of information known as the key. The decryption is performed by dedicated microprocessors in the player using decryption keys stored in the player’s memory. If you use a software application such as Apple’s iTunes to play media files, your computer’s processor performs the decryption and the keys are stored in hidden files on your computer’s hard disk.

Some DRM schemes such as Apple’s FairPlay and Microsoft’s PlaysForSure tie media files to particular authorised computers. When you authorise a computer, the player software extracts information from that machine which might include information including your name, your registered email address, the unique serial number of machine’s CPU, the serial number of the operating system and so on. This information is used to generate the key needed to decrypt the media file. For both FairPlay and PlaysForSure users are restricted to playing a file on no more than five computers; if you try to play a file on an unauthorised computer or to authorise a sixth computer you will be unable to do so.

In Microsoft’s PlaysForSure scheme, machines need to be reauthorized when users upgrade from one version of Windows to another. Information about the machine is gathered, sent across the Internet to the PlaysForSure servers and a new key issued. And this process is now causing a problem because Microsoft is abandoning PlaysForSure in favour of its own Zune music player.

PlaysForSure was an attempt by Microsoft to eat into Apple’s dominance of the music player market. Rather than build a single device to compete against the iPod, Microsoft produced the PlaysForSure standard. Any manufacturer could then build devices PlaysForSure compliant devices with Microsoft collecting a small fee for each machine sold. Music, wrapped in DRM, could then be bought from a number of online stores that supplied music in Microsoft’s Windows Media Format. The idea was that competition between manufactures would quickly drive the price of their players below that of the iPod and users would gradually switch to the more affordable product, allowing Microsoft to steal Apple’s crown.

For any number of reasons, PlaysForSure was a failure and have Microsoft switched to copying Apple’s business model. They designed their own music player, the Zune (so far only available in America) that plays music bought through the dedicated Zune Marketplace online store. Rather than have Zune compete against iPod and PlaysForSure, Microsoft has chosen to kill PlaysForSure by simply switching off the authorisation servers. As soon as the servers are switched off it will no longer be possible to get new PlaysForSure keys from Microsoft. Anyone buying a new machine or upgrading their version of Windows after that date will find they can’t play music purchased from Microsoft’s old MSN Music store. Microsoft originally intended to switch the servers off on August 31st 2008, but after a furious customer reaction, have since extended the scheme, now excitingly branded 'Certified for Windows Vista', until 2011. Hot on Microsoft’s heels, the troubled Yahoo! corporation announced that it would be shutting down the DRM servers that authenticated its Unlimited Music Store from September 2008. This time, following angry complaints from customers, Yahoo! agreed to refund the purchase cost of any music bought through Unlimited.

DRM is turning into a public-relations disaster for media companies. Customers are increasingly chaffing against the artificial restraints placed on their use of products, and more and more of them are realising that DRM only affects law-abiding customers. Pay for a DVD or Blu-ray and you can’t make a copy for your laptop or your iPod, you’re forced to sit through adverts, you can’t even buy a cheaper version of the disk from another country. Pirate copies of TV programmes, music, movies and video games are available on the Internet; they look identical but have none of the restrictions. Piracy exists because it serves consumers’ desires and until the movie studios make their official disks every bit as attractive as the illegal copies, piracy will continue to thrive.

But it is possible that DRM is nothing more than a passing phase in the media industry. Amazon in the US and iTunes now allow people to purchase MP3 versions of music which can be freely copied between devices. As a testament to its popularity, it took just a few months for Amazon to become the second-largest retailer of music in the United States after the iTunes Music Store and it is growing at a much faster rate than the Apple Store. Despite fears from the industry, there has been no explosion in piracy; just many more satisfied customers and an expanding marketplace. Perhaps it’s time for Hollywood to wake up and begin treating the people who pay its wages like responsible adults.

About the author

Mike Richards joined the Open University in 1996 to help trial teaching over the Internet. Since then he has taught courses ranging from an introduction to robots to the engineering works of Leonardo da Vinci; but has spent most of his time writing about security - everything from the Enigma machines to e-shopping. He is currently working on a new course exploring the world of ubiquitous computers; imagine a world where computers so small and cheap they can be put in everyday objects - smartphones today, smartclothes tomorrow.

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If you’ve been into a shop selling DVDs you may have noticed a new section devoted to high definition disks that go by the name of HD-DVD and Blu-ray. These disks, representing billions of Pounds worth of investment are meant to be the future of the entertainment industry, but you may also notice that no one seems to be buying them. What has gone wrong?

The DVD is often called one of the most successful consumer products in history; millions of consumers were persuaded to replace their VHS tapes with more expensive disks. The reasons are not hard to fathom: DVD is more durable, a treasured movie can resist a sticky fingered child and hundreds of playbacks with little or no degradation; and it offers much higher quality images and sound than old-fashioned tape.

The future of DVD is uncertain, and this uncertainty is caused by changes in the television industry. Since the late 1960s European broadcasters have transmitted television signals using a standard called PAL using 625 horizontal lines to build a picture. If you have bought a television in the last few years you might have noticed the ‘HD Ready’ logo on some larger sets. HD refers to High Definition, a pair of standards whose images use either 720 or 1080 lines of information. High Definition Television (HDTV) is brighter, crisper and much more appealing than PAL, but it causes problems for DVD. A DVD image is made from 576 lines which looks perfectly acceptable on a PAL television, but appears blurred on a HDTV.

The obvious solution would be to put HD content on to DVDs, but this raises yet another problem. HD images contain between two and five times as much information as those used by DVD. A DVD can easily hold a two hour movie, the same disk could hold little more than twenty minutes of high definition footage. A high definition replacement for DVD was needed.

Larger diameter DVD disks would be one solution – just as an old-fashioned LP record could hold more music than a vinyl single. In fact, large disks were used to store movies before DVD was invented. The 30cm Laserdisc format was sold as long ago as 1978 and offered picture quality similar to that of DVD. However, the bulky, fragile disks were never popular with the public and Laserdisc never became a major format.

An alternative approach would be to squeeze more information on to a DVD-sized disc. Information on a DVD is stored in billions of tiny pits; each so small that five hundred of them could easily sit on a single full stop. The disc is read by a laser, the beam either hits a flat piece of metal and reflects a flash of light into an electronic reader, or it hits one of the pits and is dispersed. The pattern of flashes created by the turning disk represents the digital information originally stored on the disk, which is converted into video and sound by the electronics in the DVD player. The capacity of the disk could be increased by moving the tiny pits closer together and making each pit even smaller.

The final improvement to DVD would be achieved by new computer software capable of compressing images into a tiny fraction of their original size without spoiling their appearance.

In 2002, Toshiba and NEC unveiled the Advanced Optical Disk. Offering three times the storage of a conventional DVD, this new disk could be manufactured in existing DVD factories and offered a straightforward path to a high definition future. The following year, the industry body tasked with supervising the DVD standard made the AOD the official successor to DVD. Rebranded as HD-DVD, the first high definition movie disks were released in early 2006. The future of DVD was clear - or was it?

In short - no; there is a rival to HD-DVD and it comes from one of the giants of the electronic industry - Sony. Whilst many of us think of Sony in terms of televisions and the once all-conquering Walkman, it is actually a group of companies of which electronics is only one part. The Sony group also produces film, music and television through its Sony Music Entertainment and Columbia Pictures labels, but perhaps its most powerful weapon is the Playstation video game system.

Sony has sold more than 120 million Playstation 2 consoles, each containing a DVD player. In many countries the PS2 was the first affordable DVD player - it helped create the colossal current market for DVD entertainment. When Sony began to create the Playstation 3 they saw it as the centerpiece of a whole new business. Their new, proprietary high definition format would not only allow the PS3 to play bigger games, but it could be used for movies and music. Sony would licence their disk format to other companies, who would have to pay a licence fee on every disk. If this ambitious plan worked, Sony would have a colossal, guaranteed income for years to come.

Sony began work on their high definition disk format in 2000 and announced Blu-ray in 2002. With five times the capacity of a DVD, Blu-ray disks are even larger than HD-DVD, but were completely incompatible with the rival disks. Despite this, the majority of Hollywood studios announced that future movies would be released only on Blu-ray. It seemed that Sony had stolen the high definition market from underneath HD-DVD’s nose.

Unfortunately for Sony, the Blu-ray technology proved to be difficult and expensive to manufacture. Supplies of the vital blue lasers used to read the disk were extremely limited, delaying the introduction of Playstation 3 and making it much more expensive than originally planned. Sales of the console have been solid, but unspectacular; the PS3 has not become the best selling games console once hoped by Sony and Blu-ray has failed to eliminate its rival and become the single high definition format.

Today the market for high definition content is paralysed; the two formats offer practically indistinguishable content, yet are completely incompatible with one another. Whilst the majority of movie studios favour Blu-ray, HD-DVD players are far cheaper than their rivals - American customers can now buy HD-DVD players for as little as $99. Perhaps unsurprisingly sales have been embarrassingly slow; this summer’s blockbuster Transformers sold 190,000 HD-DVDs in its first week of American sales, but the DVD release sold 8.3 million disks in the same period.

The Blu-ray / HD-DVD battle increasingly resembles two bald men fighting over a comb and it is quite possible both formats could lose out. There is another way of delivering high definition content and it comes from a technological superpower - Microsoft.

In the last few years, Microsoft has won a sizeable chunk of the video game market with its XBox and XBox 360 video games consoles. The 360 is a powerful machine, easily capable of producing high definition output, and it comes with a broadband Internet connection to Microsoft’s XBox LIVE service.

Originally LIVE was designed to let games players compete over the Internet and to download games data, but it is increasingly being used to provide video on demand - and much of that video is in high definition. The XBox Video Store was launched in America in late 2006 and will arrive in Europe early in 2008. XBox Video Store is a chance for Microsoft to steal a lead not only over Sony, but also Apple’s iTunes service which dominates online music downloads.

With over 14 million XBox 360s already sold and millions more to be sold during the run-up to Christmas 2007, Microsoft is making a strong bid to be the preferred provider of high definition content in millions of homes. Sony’s Playstation 3 could make a formidable competitor, but for Sony to provide online downloads of high definition content would almost completely invalidate its Blu-ray gamble, the company would have invested billions to almost no gain and be gravely weakened in the inevitable battle of the next-generation consoles.

Once people get used to the almost unlimited choice available online, why will they want to invest in either of HD-DVD or Blu-ray? In the meantime, there is one clear winner to the disk format war – DVD.

About the author

Mike Richards joined the Open University in 1996 to help trial teaching over the Internet. Since then he has taught courses ranging from an introduction to robots to the engineering works of Leonardo da Vinci; but has spent most of his time writing about security - everything from the Enigma machines to e-shopping. He is currently working on a new course exploring the world of ubiquitous computers; imagine a world where computers so small and cheap they can be put in everyday objects - smartphones today, smartclothes tomorrow.

Subscribe to Mike Richards's posts