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Blockbuster Sides With Blu-ray

Dallas — In what must be seen as a major blow to the HD DVD high-definition optical disc format, Blockbuster, one of the nation’s largest video rental chains, said it will carry HD disc movies exclusively in the Blu-ray Disc format in all future brick-and-mortar stores that add high-definition software.

The chain had been stocking both Blu-ray and HD DVD discs at 250 select stores around the country, but executives said its business with Blu-ray significantly outpaced HD DVD in those accounts.

As a result, Blockbuster said it will expand the number of stores worldwide offering the Blu-ray format to 1,700 by the middle of next month.

Blockbuster will continue to carry HD DVD and Blu-ray titles at stores that currently offer them, as well as through its online rental service.

“We intend to meet the demands of our customers and we are expanding our Blu-ray inventory to ensure that our stores reflect the right level of products,” stated Matthew Smith, Blockbuster merchandising senior VP.

“While it is too early to say which high-definition format will become the industry standard, we will continue to closely monitor customer rental patterns at our stores and online so we can adjust our inventory mix accordingly.”

Blockbuster began offering high-definition movies in both formats last November through its online service and in 250 stores

With the expansion in July, the 1,700 stores will be carrying more than 170 Blu-ray titles and will continue to add titles in the format as they are released.

Obviously, when customers are ready, we can expand the Blu-ray offering into more stores and add HD DVD to more locations if that is what customers tell us they want, said Smith.

In a statement on the decision Toshiba said, “they say themselves that no winner can be declared yet, which makes sense given that the high definition rental market is still just a fraction of the high definition sales to date. That said, we see this decision by Blockbuster as limiting a choice for consumers. The HD DVD camp has the fastest selling dedicated high definition player on the market – with a movie attach rate that’s 4 to 1 over Blu-ray. And we’re forecasting more than a million HD DVD players by the end of 2007. Why would Blockbuster ignore these consumers when other rental chains are not?