"Strategy Analytics Inc., a global information and entertainment technologies research firm, recently released a report in which they predicted the Blu-ray Disc to dominate in the battle over the next generation DVD format. The discussion over the new HD format, Blu-ray or HD-DVD, has been a polarizing one for the entertainment industry, video games included. The Blu-ray Disc, put forward by Sony, has garnered support from the home entertainment sector with companies like Toshiba and various Hollywood movie studios. The HD-DVD has mainly been relegated to the PC community, led with support from Intel and Microsoft.

"For all the talk of a unified digital home, deep divisions still remain," notes David Mercer, Principal Analyst at Strategy Analytics. "Billions of dollars of revenue are at stake as PC companies battle with the consumer electronics industry for control of the digital home media server. DVD's replacement will play a critical role in determining the success or failure of each group."

Both of the new HD formats will require an entirely new device infrastructure, as neither the Blu-ray nor HD-DVD will play in current DVD or CD-ROM devices. These new devices are expected to carry high price tags, but Sony has a back door into the market.

Sony’s next generation console, the Playstation 3, will be the jump off point for the Blu-ray Disc. The Playstation 3 will put Blu-ray Disc players in millions of homes around the world, and the success of the PS3 may also mean the success of Blu-ray." [link]