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This article comes from EV dated 1/16/01
"Format war rekindles as JVC rolls out D-VHS"
Fox, U show support for release; WB, Col skeptical
By PAUL SWEETING
LAS VEGAS -- With final agreement on a digital copy-protection system still pending, studio types cast a wary eye on the recordable DVD systems, digital VCRs and growing number of cable and satellite set-top boxes equipped with TiVo- and Replay-like hard drives shown off at the Consumer Electronics Show in Las Vegas last week.
But digital recording platforms weren't the only troubling technology on display: Nearly lost amid the hoopla over digital recorders was news of the imminent launch of a new, high-definition prerecorded format that could steal thunder from the still nascent DVD market.
VHS developer JVC says it will launch a digital VHS (D-VHS) system in the U.S. by late spring and expects to have prerecorded software support from several major studios.
At its CES booth, the company featured clips from recent Fox, Universal and New Line releases to showcase the new format. While none of those companies has officially committed to releasing product in D-VHS in time for JVC's planned launch, both Fox and Universal indicated support for the format in press releases.
"The entire 20th Century Fox library of motion pictures and our future productions released in digital, high-resolution formats will represent a whole new viewing experience on widescreen digital TVs," Fox New Technology Group exec VP Andrew Setos said in a statement. "We look forward to making our motion pictures widely available using new consumer electronics devices such as D-VHS and digital set-top boxes â€¦ for an all-digital, high-resolution experience."
In a separate statement, U senior VP Jerry Pierce said, "High-definition movies will offer consumers the ultimate in a home theater experience."
A fourth studio, DreamWorks, also provided clips to JVC, according to sources, but was not able to get them authored in D-VHS in time for display at CES.
For other studios, however, JVC's timing couldn't be worse.
Sticking with DVD
As the strongest studio supporter of DVD, Warner Bros. is adamantly opposed to the introduction of a second digital prerecorded format at this time, fearing it could disrupt the DVD market. And while less strident in its views than Warner, Columbia is also skeptical of D-VHS.
"I think the lateral compatibility of DVD with DVD-ROM, laptop computers and PlayStation make it clearly a preferable format to any tape-based product," said Columbia TriStar Home Entertainment prexy Ben Feingold.
The launch of D-VHS could also revive old arguments over copy-protection for digital prerecorded formats.
The copy-protection standard built into D-VHS, known as High-bandwidth Digital Content Protection (HDCP), is regarded by most experts as more robust than the Content Scrambling System (CSS) used for DVD.
Some studios wanted to hold out for the more robust standard for DVD but were thwarted by U.S. government restrictions (since lifted) on the exporting of high-level encryption systems. CSS was adopted to get DVD on the market sooner.
Since then, however, CSS has been hacked, underscoring the fears of those who wanted to hold out for the stronger standard. And while MPAA lawsuits may succeed in containing the spread of the DeCSS hacking program, the CSS system's vulnerability has clearly been exposed.
The biggest threat D-VHS poses to DVD's market dominance, however, stems from the fact that it's a high-definition format, fully compatible with the U.S. HDTV standard. DVD is based on the current resolution standards for U.S. TVs and will not be compatible with HDTV receivers.
While consumer electronics companies are working on high-def DVD players, commercial models aren't likely to be ready for at least three to five years.
If HDTV takes off in the meantime, D-VHS could establish itself as the prerecorded format of choice for the high-definition era.
Plenty of obstacles remain before that can happen, however. As a recordable format, D-VHS is still subject to copy-protection rules for digital recording. Until those are resolved, JVC won't be able to sell fully functional D-VHS machines in the U.S.
The format is also likely to be expensive, at least initially. According to sources at CES, early models are expected to go for $1,700-$2,000, while high-def blank tapes could cost as much as $30 each.
But recordable formats have proven appeal among American consumers. And as an extension of the existing VHS format, D-VHS is fully compatible with tapes recorded on the older machines -- of which there are 85 million in the U.S. alone.