Feeling Blues in Next-Gen HD Discs
The second piece of information that you need to understand is that, in many cases, an entire HD movie will actually fit on a standard DVD. Yes, it's true that at 8-9 MBit/second you won't see transparency to the source. However, for an average length film with no "extras" most people would be hard-pressed to tell the difference; they have neither the equipment nor the eyes to do so. In fact, nearly three years ago (a lifetime in terms of development) Terminator 2 was released on a standard DVD using a very similar encoding scheme to those used in both Blu-ray and HD DVD . Since then, both the VC-1 encoding process and H.264 encoding have made tremendous improvements and continue to get more efficient with each passing month.
The answer, as stupid as it seems, is the navigation system. While nearly every aspect of the disc is the same, HD DVD uses the Microsoft-developed iHD while Blu-ray uses a Java-based system. By using two different navigation systems, both parties have excluded the possibility of dual-system HD discs.
Where major studios have the clout, the finances, and the time to release two different versions of the same content using the latest disks, independent producers don't. Doing so means twice as much inventory, twice as many production hassles, etc. Furthermore, it is the independent producers (be they filmmakers or even home enthusiasts) who would have been more likely to utilize the red laser feature. In the case of small production houses, they might already have invested in DVD-burners. In the case of enthusiasts, they might choose to create a disc they know will be compatible with their friend's HD player." I'm sure new codec will allow HD content within current DVD/red laser system. But I'm betting on blu-ray to come out on top, for the very reason of PS3.

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