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HD DVD Wins Studio Exclusives

New York — The HD DVD format got a major shot in the arm Monday when Paramount Pictures and DreamWorks Animation SKG studios revealed that they will now exclusively support the HD DVD format on a worldwide basis.

Paramount Home Entertainment said it will now issue new releases day and date as well as catalog titles exclusively on HD DVD.

The exclusive commitments to HD DVD erases an earlier decision by Paramount to support both Blu-ray Disc and HD DVD, and now gives the HD DVD format three exclusive studio supporters along with Universal Studios. The Weinstein Company also supports HD DVD but has not announced an exclusive decision.

The news also means that the high-definition disc format war is likely to go on quite a bit longer before a winner is ever determined.

It also leaves Warner Bros. and affiliated studios as the only source supporting both Blu-ray and HD DVD.

Blu-ray Disc, in turn, is backed by Sony Pictures, Disney, Fox, MGM and Lions Gate.

According to a statement, Paramount’s decision will include all movies distributed by Paramount Pictures, DreamWorks Pictures, Paramount Vantage, Nickelodeon Movies and MTV Films, as well as movies from DreamWorks Animation, which are distributed exclusively by Paramount Home Entertainment.

However, the announcement does not include films directed by Steven Spielberg, who is not committing to either format. His “Close Encounters of the Third Kind” was recently announced for a Blu-ray Disc release.

The companies each said that the decision to back HD DVD exclusively followed extensive evaluation of both formats, which showed that HD DVD had superior benefits topped by market-ready technologies and lower manufacturing costs.

HD DVD recently enabled its networked Internet connectivity capability, which opens the doors to a range of interactive extras studios can provide through Web sites linked to HD DVD discs.

Paramount Home Entertainment said it will begin its newly exclusive HD DVD program with the release of the comedy “Blades of Glory” on Aug. 28. That will be followed by “Transformers” and “Shrek the Third,” which are among the top box office grossers of the year.

The three titles represent more than $1.5 billion in box office ticket sales worldwide, Paramount said.

“The combination of Paramount and DreamWorks Animation brings a critical mass of current box office hits to consumers with a lineup of live action and animated films that are perfect for HD DVD,” stated Brad Grey, Paramount Pictures chairman and CEO. “Part of our vision is to aggressively extend our movies beyond the theater, and deliver the quality and features that appeal to our audience. I believe HD DVD is not only the affordable high-quality choice for consumers, but also the smart choice for Paramount.”

“We decided to release ‘Shrek the Third’ and other DreamWorks Animation titles exclusively on HD DVD because we believe it is the best format to bring high quality home entertainment to a key segment of our audience — families,” stated DreamWorks Animation CEO, Jeffrey Katzenberg. “We believe the combination of this year’s low- priced HD DVD players and the commitment to release a significant number of hit titles in the fall makes HD DVD the best way to view movies at home.”

At press time, parties affiliated with the Blu-ray Disc Association pointed to an article on the Web that cited unnamed sources in reporting that HD DVD backers had paid heavily ($100 million for DreamWorks and $50 million for Paramount) for the exclusive commitments.

Responding to queries on the payment report, Paramount released a statement saying: “The reason we made this decision is simple. After a year of fully experiencing and exploring both formats, we decided to exclusively support HD DVD because of the quality, value and potential the format offers.  Beyond that, whenever we conduct co-marketing, production deals or other agreements, we never discuss business terms.”