Taiwanese firms weigh in with new digital format

Tech rebels seeking to have DVD Forum endorse their upstart FVD technology in race to become next-generation standard Call them Taiwanese tech rebels - with the industry abuzz about the fierce competition between Blu-ray and High-Definition DVD, the Japanese-backed technologies that promise to make DVD obsolete, along comes a gang of 30 Taiwanese companies to crash the party. The Taiwanese offering, called Forward Versatile Disc (FVD), is cheaper, more simple and more compatible with existing technologies than either of the new offerings. The technology is to be put to the DVD Forum today in a bid to have FVD endorsed by the organisation that administers DVD standards. At stake is whether this upstart technology will get a foothold in the multibillion-dollar home entertainment industry and, in so doing, beat Blu-ray and HD-DVD in the race to become the next-generation standard. HD-DVD is officially backed by the DVD Forum while Blu-ray has large firms such as Sony, Philips and Pioneer behind it. It is a little-known fact that about 30 per cent of the wholesale price of a DVD disc, and as much as US$15 for every player, goes to the DVD technology rights holders. Both Blu-ray and HD-DVD are looking to replicate that lucrative business model. With no royalties now being charged, FVD poses a threat to that income stream. 'Whether the DVD Forum approves the FVD standard or not will be a political decision, not a technology decision,' said Huang Der-ray, deputy director-general of the Opto-electronics and Systems Laboratory at Taiwan's semi-government Industrial Technology Research Institute (Itri). Mr Huang is the head cheerleader for the new FVD standard and he is Taiwan's lone voice on the 20-member DVD Forum steering committee. The panel is half Japanese, with five US companies, two European and two South Korean companies making up the numbers. The composition of the committee is particularly ironic given that most DVD players are now made by Taiwanese companies. 'This is an important issue for Taiwan companies because Taiwan is the No1 manufacturer in the world,' Mr Huang said. Sick of paying high royalty fees and eager to gain more control over the technology they use, Taiwanese companies have been working together to get the new standard off the ground. But the issue of FVD endorsement is partly technical and partly political. The FVD standard uses the same wavelength laser as DVD (650 nanometers), but offers better storage and better compression and encryption. This means new DVD players can easily be made to be FVD compatible with only minimal extra costs while offering significantly better quality. Whereas a DVD can play 135 minutes, an FVD can play 300 minutes and approaching 10 hours in later versions of the standard. A twist in the new fight between HD-DVD, FVD and Blu-ray is that under DVD licensing rules, only endorsed technologies can be put into players that carry the DVD logo. HD-DVD has been endorsed, Blu-ray has not. Chen Tsuo-tsai, product manager at the joint-venture Philips and BenQ Digital Storage Corp, which backs each of the technologies, said: 'We can't say something just because it's claimed by Itri or some companies. We have to wait for DVD Forum authorisation.' In other words, without an endorsement from the DVD Forum manufacturers cannot use FVD in their players and still use the DVD logo. Mr Chen said his company already had FVD-compatible players ready to ship, with the term FVD unlikely to be seen anywhere on the packaging or product manual. No one is claiming that FVD is technically superior to Blu-ray or HD-DVD. After all, Blu-ray will be able to offer up to 50 gigabytes of storage and HD-DVD 32GB, compared with FVD's maximum of 15GB. But FVD's proponents say that is irrelevant. Mr Huang said: 'I don't think Blu-ray will have a good place in the market because most [digital] players will have a hard disk built in. If users want to save something they can just save it on the hard disk.' The real downside to Blu-ray and HD-DVD is the cost. The 405nm blue lasers are incredibly expensive because of poor yields, tight supply and high royalty fees. Despite both using blue lasers, they are not cross-compatible. Blu-ray players start at US$1,000 retail compared with US$100 for FVD players. Mr Huang said the better video quality of Blu-ray and HD-DVD over FVD would not even be noticed by most consumers.