So who is making money off of DVD and how does it affect the war? - High-Def Digest Forums
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Old 11-09-2007, 01:09 PM
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Default So who is making money off of DVD and how does it affect the war?

I have wondered this for some time. I went to the DVD forum website and saw that they have are over 220 members but I could not find in definitive answer to who actually makes the profits. I saw that any corporation can join as long as the follow certain guidlines and pay about $10K per year.

http://www.dvdforum.org/forum.shtml

I did some searches on DVD patents and came across this lawsuit by Toshiba. Apparently they were suing several companies over patent rights violations. The DVD forum was not named in the article only Toshiba.

http://www.informationweek.com/story...leID=199000342

I found another legal document stating the Toshiba would sub license to Hitachi.

Quote:
This letter is in response to your request on behalf of Hitachi, Ltd., Matsushita Electric Industrial Co., Ltd., Mitsubishi Electric Corporation, Time Warner Inc., Toshiba Corporation, and Victor Company of Japan, Ltd. (collectively, the "Licensors"), for the issuance of a business review letter pursuant to the Department of Justice's Business Review Procedure, 28 C.F.R. 50.6. You have requested a statement of the Department of Justice's antitrust enforcement intentions with respect to a proposed arrangement pursuant to which Toshiba will assemble and offer a package license under the Licensors' patents that are "essential," as defined below, to manufacturing products in compliance with the DVD-ROM and DVD-Video formats and will distribute royalty income to the other Licensors.
I also looked on Wikipedia found some more news.

Quote:
Ten companies founded the organization:

Hitachi, Ltd.
Matsushita Electric Industrial Co. Ltd.
Mitsubishi Electric Corporation
Pioneer Electronic Corporation
Royal Philips Electronics N.V.
Sony Corporation
Thomson
Time Warner Inc.
Toshiba Corporation
Victor Company of Japan, Ltd. (JVC)
In 2003, the DVD Forum had 208 members. At present, there are 195 registered members.[
Finally found this little article on History that should clear up who really owns DVD.

http://en.wikipedia.org/wiki/DVD

Quote:
In the early 1990s two high-density optical storage standards were being developed; one was the MultiMedia Compact Disc, backed by Philips and Sony, and the other was the Super Density disc, supported by Toshiba, Time Warner, Matsushita Electric, Hitachi, Mitsubishi Electric, Pioneer, Thomson, and JVC. IBM's president, Lou Gerstner, acting as a matchmaker, led an effort to unite the two camps behind a single standard, anticipating a repeat of the costly videotape format war between VHS and Betamax in the 1980s.

Philips and Sony abandoned their MultiMedia Compact Disc and fully agreed upon Toshiba's SuperDensity Disc with only one modification, namely changing to EFMPlus modulation. EFMPlus was chosen as it has a great resilience against disc damage such as scratches and fingerprints. EFMPlus, created by Kees Immink, who also designed EFM, is 6% less efficient than the modulation technique originally used by Toshiba, which resulted in a capacity of 4.7 GB as opposed to the original 5 GB. The result was the DVD specification, finalized for the DVD movie player and DVD-ROM computer applications in December 1995.[1] In May 1997, the DVD Consortium was replaced by the DVD Forum, which is open to all other companies.
So in conclusion it appears that the people actually making money off of DVD are the following:

Hitachi
Matsushita
Mitsubishi
Time Warner = Warner Brothers
Toshiba = Main Licensor
Victor

It has been stated that the HD media market could be worth billions upon billions of dollars to the Licensing groups. That would lead me to believe that the DVD group is worth billions upon billions of dollars right now.

The importance in knowing who gets the money for DVD is that members such as Toshiba may be losing money on HD DVD format but should they lose or yield to the BDA their DVD funds would start to diminish over the next few years. Sony and the BDA will have to destroy Toshiba and HD DVD and out an out win before the DVD forum would ever consider folding. Every day the war is prolonged is another day that DVD dollars continue to flow in.


Another interesting observation is that Time Warner has got its fingerprints all over DVD and receives some of the licensing fees for every disc sold. It would be hard for many to fathom that Warner would turn its back on DVD if the monetary reward is substantial. Hard to say what their cut is but it would be interesting if they walked away with DVD still being so strong and the HDTV market still in its childhood.

So take it as you will but I see this war raging on for at least another 2 years even if Warner were to go Blu-ray only (which would apear to be highly unlikely).
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Old 11-09-2007, 02:13 PM
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Originally Posted by Monty HD View Post

So in conclusion it appears that the people actually making money off of DVD are the following:

Hitachi
Matsushita
Mitsubishi
Time Warner = Warner Brothers
Toshiba = Main Licensor
Victor
Sony
Philips
Fixed it for you

Seriously, both Philips and Sony make royalties off of the error correction code system they brought to what became the DVD format. They don't make as much as Toshiba, but they DO make money. They also both have leftover royalty money on patents used for DVD that go back to the CD format.
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Old 11-09-2007, 02:50 PM
Monty HD's Avatar
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Thanks. Hard to find any hard numbers. It would be nice to know what was at stake monetarily for all parties.
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