By Michael Kanellos
Thursday, October 12 2006 02:53 PM
URL: http://www.zdnetasia.com/news/hardware/0,39042972,61959160,00.htm

A truce between the Blu-ray and HD DVD worlds is still probably a way off, but NEC has come up with a chip that could help companies bridge the gap.

The chip, essentially a controller, works in both Blu-ray and HD DVD players. One chip that works with both standards could cut the cost of building a player that accomodates Blu-ray and HD DVD discs.

The chip will start shipping in April 2007, NEC said.

The appearance of a combination player, however, could still take time. Companies such as Pioneer and LG announced plans to come out with combination players, but later backed away.

Cost is the main culprit. Blu-ray players cost about US$1,000, and the player/recorders run to about US$3,200. HD DVD players start at around US$500, but the recorders cost about the same.

The high price, in part, is due to components. Since mass manufacturing has just begun, the parts still cost a lot, although prices will decline in 2007. Sony, in fact, had to stagger the release of the PlayStation 3 because of shortages of lasers. Nonetheless, Stan Glasgow, president of Sony Electronics, recently said that Blu-ray players could drop to US$500 by the end of next year.

Even with the expected price declines, building a hybrid player would involve redundant components. Other components that can handle both standards would also likely have to be developed to bring the price of a hybrid player down.

But royalties are also a factor. The companies that invented the standards could make millions in licensing fees over the next decade if their standard gets adopted widely. Building a combo player, therefore, would require paying royalties to both camps.

Further complicating the matter are the high emotions generated by the dispute. Last week at the Ceatec trade show in Japan, reporters asked Kazuhiro Tsuga, an executive officer at Matsushita Electric, a firm member of the Blu-ray camp, about the possibility of Blu-ray/HD DVD combo players hitting the market.

"That is stupid, stupid," he said, noting that the cost would be high. Matsushita sells products under the Panasonic name in the United States.

Still, other manufacturers are intrigued by the idea, especially if the format wars hurt sales. Hitachi, which is concocting a camcorder that will record directly to Blu-ray discs, said it will study the issue of a combo recorder after Blu-ray is established in the market.