Origins and competition from Blu-ray Disc

In the mid 1990s, commercial HDTV sets started to enter a larger market. However, there was no cheap way to record or play back HD content. There was no cheap storage medium that could store that amount of data, except JVC's Digital VHS and Sony's HDCAM.^[3] However, it was well known that using lasers with shorter wavelengths would yield optical storage with higher density. When Shuji Nakamura invented practical blue laser diodes, it was a sensation, although a lengthy patent lawsuit delayed commercial introduction

Sony started two projects applying the new diodes: UDO (Ultra Density Optical) and DVR Blue (together with Pioneer), a format of rewritable discs which would eventually become Blu-ray (more specifically, BD-RE).^[5] The core technologies of the formats are essentially similar. The first DVR Blue prototypes were unveiled at the CEATEC exhibition in October 2000.^[6] In February 2002, the project was officially announced as Blu-ray,^[7] and the Blu-ray Disc Association was founded by the nine initial members.

The DVD Forum (which was chaired by Toshiba) was deeply split over whether to go with the more expensive blue lasers or not. Although today's Blu-ray Discs appear virtually identical to a standard DVD, when the Blu-ray Discs were initially developed they required a protective caddy to avoid mis-handling by the consumer. (Early CD-Rs also featured a protective caddy for the same purpose.) The Blu-ray prototype's caddy was both expensive and physically different from DVD, posing several problems.^[8] In March 2002, the forum voted to approve a proposal endorsed by Warner Bros. and other motion picture studios that involved compressing HD content onto dual-layer DVD-9 discs.^[9][10] However, in spite of this decision, the DVD Forum's Steering Committee announced in April that it was pursuing its own blue-laser high-definition solution.^[11] In August, Toshiba and NEC announced their competing standard Advanced Optical Disc.^[12] It was finally adopted by the DVD forum and renamed to HD DVD the next year,^[13] after being voted down twice by Blu-ray Disc Association members, prompting the U.S. Department of Justice to make preliminary investigations into the situation.^[14][15] Three new members had to be invited and the voting rules changed before the vote finally passed

Attempts to avoid a format war

Main article: High definition optical disc format war

In an attempt to avoid a costly format war, the Blu-ray Disc Association and DVD Forum attempted to negotiate a compromise in early 2005. One of the issues was that Blu-ray's supporters wanted to use a Java-based platform for interactivity (BD-J), while the DVD Forum was promoting Microsoft's "iHD" (which became HDi).^[18] A much larger issue, though, was the physical formats of the discs themselves; the Blu-ray Disc Association's member companies did not want to risk losing billions of dollars in royalties as they had done with standard DVD.^[19] An agreement seemed close, but negotiations proceeded slowly and ultimately stalled.^[20]

On August 22, 2005, the Blu-ray Disc Association and DVD Forum announced that the negotiations to unify their standards had failed.^[21] Rumours surfaced that talks had stalled; publicly, the same reasons of physical format incompatibility were cited.^[19][22] In the end of September, Microsoft and Intel jointly announced their support for HD DVD.^[23]

Hewlett Packard (HP) made a last ditch attempt to broker a peace between the Blu-ray Disc Association and Microsoft by demanding that Blu-ray association adopt Microsoft's HDi instead of its own Java solution and threatening to support HD DVD instead.^[24] However, the Blu-ray Disc group did not accept HP's proposal

http://en.wikipedia.org/wiki/HD_DVD