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Technology Stocks : C-Cube
CUBE 36.31-0.9%3:59 PM EST

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To: Robert Utne who wrote (22410)9/11/1997 10:21:00 AM
From: BillyG   of 50808
 
Dataquest says that incomptibilities will slow the DVD market -- and this was before they factored in the effect of Divx.........

-Dataquest: DVD+RW: Sony, Philips, and HP finally make the official
announcement

M2 PRESSWIRE-10 September 1997-Dataquest: DVD+RW: Sony, Philips, and HP finally make the official announcement
(C)1994-97 M2 COMMUNICATIONS LTD

On September 3, Hewlett-Packard Company, Philips Electronics N.V., Sony Corporation, Mitsubishi Chemical Corporation,
Ricoh Company Ltd., and Yamaha Corporation officially announced specifications for a rewritable DVD format. This
data-storage format specifies an initial capacity of 3.0GB per disc surface. According to these companies, products supporting
this format will be known as DVD+RW drives. This new format is a departure from the DVD-RAM format specification that
was previously approved by the DVD Forum
and called out a capacity of 2.6GB per disc surface.

Developed by HP, Philips, and Sony, the ReWritable specification is an open format that was submitted to the European
Computer Manufacturers Association (ECMA) standards committee in May 1997.

DVD+RW Format Specifications

Disc diameter120mmDisc thickness0.6 x 2Physical addressFM modulated in CAV wobble grooveTrack pitch0.8
micrometerFormatted capacity3.0GB/sideLaser wavelength650 nanometersModulation code8-16 modulation (2,10)
RLLRecording principleMark-edge recording on phase-change materialWriting methodCAV/CLVWritten formatConstant
linear density (CLD)

The announcement did not include the fact that no cartridge is required for the single-layer, two-sided disc. No products were
announced, but Dataquest expects that drives will be available in the second half of 1998 with price points well below $1,000.

A New Battle?

Besieged by delays because of multiple proposals for a new consortium-approved rewritable DVD format specification, the
DVD Forum was paralyzed for months by the battle between two camps, Toshiba/Matsushita and Sony/Philips. Agreement
on a rewritable format specification, named DVD-RAM, was finally reached by the DVD Forum in April 1997 after several
months of hot debate. Or so the industry was told. DVD-RAM is a rewritable DVD format that offers a storage capacity of
either 2.6GB on one side or 5.2GB using both sides of a 120mm disc. A cartridge is required for a DVD-RAM disc that is
written on both sides.

Following immediately on the heels of the agreement regarding the format, Hitachi Ltd. and Matsushita Electric Industrial
Co.(MEI) separately announced plans on April 23 to launch DVD-RAM drives, which conform to that format. Hitachi
received much of the credit for facilitating the fusion of the two different approaches, either of which would work. However,
this gave rise to uncertainty of whether the individual companies involved would still each go separate ways, thus completely
canceling out the objective of providing a unified standard. This has been borne out by this week's announcement that Sony,
Philips, and HP have developed their own version of rewritable DVD, which they are naming DVD+RW. In May, only one
month after the DVD-RAM format was approved by the DVD Forum, the three companies applied to ECMA for approval
of their higher-capacity 3.0GB rewritable DVD format specification. Dataquest believes this action implies that there was
never a consensus by all of the DVD Forum members to support one rewritable DVD format.


Dataquest Perspective

As specifications were being developed for revolutionary technology aimed at "convergence between consumer electronic and
personal computer products, the press releases by the DVD consortium led everyone to believe that an industry standard
would be created. Dataquest believes that the announcement of DVD+RW flies in the face of why the consortium, which
Sony and Philips are part of, was formed to create an industry standard to ensure compatibility among all DVD-based
products.


There is no doubt that incompatibilities will exist between DVD-ROM and DVD-RAM, and no claims were ever made that
these would not exist initially. One incompatibility already exists. As it is, the first generation of DVD-ROM drives will not be
able to read a DVD-RAM disc written on both sides because they are not designed to accept a cartridge. Not only does the
Sony/Philips/HP announcement create incompatibilities between rewritable DVD drives (DVD-RAM and DVD+RW) but
also between present as well as future generations of DVD-ROM drives. The Sony/Philips/HP press release states that "the
new format adds only the minimal features to the existing DVD-ROM spec to allow random rewritability, thus allowing
DVD-ROM drives to read DVD-RW discs at virtually no additional cost." The implication appears to be that to implement
the DVD-RAM specification will require additional costs to future generations of DVD-ROM drives to be able to read discs
written on a DVD-RAM drive.

DVD may be the long-awaited answer for an improved movie viewing experience and higher data storage capacities, but in
the light of this recent announcement and others, including NEC's Multimedia Video File (MMVF) format and the
consortium-based Advanced Storage MO (ASMO) group, DVD will take more time than originally thought to prove itself.


The common cry is that "the marketplace will decide". This implies that the marketplace consists of consumers smart enough to
evaluate "technology" that they care little about. The average consumer only cares about the "new and improved" audio or
visual experience that a DVD-ROM drives with no compelling reason to make an investment in a device with little available
movie and multimedia content. The other part of the marketplace consists of systems average or otherwise. PC manufacturers
are already confronted with multiple choices of removable media disk drives on which to store data and most of them already
have plans in place to ship DVD-ROM drives in their PCs. However, with all the new choices of DVD-based rewritable
products and accompanying incompatibilities, this market will require more time than originally anitcipated to get itself sorted
out.
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