Mainland adopts new DVD format

The move will cut royalty payments by US$2 billion a year and strike at piracy

A new national standard for DVDs will be announced today, making China the first nation to choose its own video compression standard over one that is commonly accepted worldwide.

The new standard, to be announced by the Ministry of Information Industry, has been developed domestically with the help of a US company.

It will help the central government save up to US$2 billion a year in royalties paid to the consortium that controls MPEG2, the video compression technology that is the current world standard.

Called Enhanced Versatile Disc or EVD, the new standard will also allow the mainland's digital versatile disc manufacturers - collectively the largest group of suppliers in the world - to create a global standard that will challenge MPEG2's dominance of DVD markets.

'They don't have to use MPEG2 if they don't want to,' said Douglas McIntyre, chairman and chief executive officer of New York-based On2 Corp, which helped develop the new video standard. 'China is so large that it could choose its own way in the world.'

MPEG2 is controlled by 18 US, European and Japanese entertainment giants, among them Microsoft, Time Warner, Sony and Philips. On2's eight-month-old video compression technology, called VP6, compresses more data and gives higher-resolution pictures.