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Blu-ray, HD DVD Wars: Why You Are Caught In The Middle

So a week has passed since my first poston the drama surrounding the HD DVD vs. Blu-ray next generation format war. Hundreds of emails, though the pro Blu-ray, anti-Jim emails outnumbered the HD DVD side by better than ten to one. Not sure what message that sends, but maybe I angered the Blu-ray folks more than I satisfied the HD folks.

Either way, I'm back at it again, knowing full well there simply is no way to please either side. And seeing how both sides bring up very compelling arguments, I can only imagine the difficulty consumers face when faced with making the choice. And that's a big problem for both formats.

This could be a make or break holiday season for either one. Kmart's move to push HD DVD over Blu-ray, without coming out one way or the other on an "exclusive" offering is interesting. Target is Blu-ray "exclusive," but still carries the HD DVD drive for Xbox sells HD DVD titles, and still offers HD DVD players online.

And maybe that's where this all goes. Maybe we're destined for a long-term, dual format kind of world. Blu-ray can sure help its cause if it lowered prices in a meaningful way. Some thought Toshiba's big Wal-Mart price cuts last week were a signal of a fire sale of some kind; that Toshiba could unload inventory and was forced to make steep cuts. Turns out, the cuts were Wal-Mart's idea and Best Buy followed suit. Not a move by Toshiba. Interesting.

I've spoken to a lot of people, and gotten a lot of emails, that this is a cost-story, plain and simple. The technical specs of Blu-ray might be superior, though that too is subject to serious debate, but if costs don't come down, Blu-ray runs the risk of losing this war.

The final part of this story worth watching: the studios. Some are coming down neutral. Others are choosing camps. Warner Home Video caused a lot of confusion recently. There had been a lot of talk that the studio was "leaning" toward Blu-ray exclusively thanks to recent comments from a studio executive pointing to strong Blu-ray sales, with the studio "committed to the format.

But just days later, after breathless speculation by Blu-ray bloggers, Warner back-peddled and said indeed it's position hadn't changed, that its support of both formats continued and that no announcements to the contrary are coming.

Look, I don't pick sides. There are strong, compelling arguments on both sides. HD DVD supporters are championing news from yesterday that U.S. household penetration will hit 500,000 units this month. Last week's Wal-Mart/Best Buy price cuts certainly helped that cause with some reports showing 90,000 standalone units sold that weekend alone.

That makes HD DVD the "standalone" leader, even though Blu-ray enjoys healthy penetration of its own, thanks to the over 2.2 million PS3 gameplayers with Blu-ray included inside, sold in the U.S. so far. Let the debate roll on. Sadly, the consumer will continue to be caught in the middle.

Questions? Comments? TechCheck@cnbc.com

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