Toshiba HD-A20.

FEB. 11, 2008 • After suffering a serious disaster in Warner Home Video’s defection to Sony Electronic’s Blu-ray HD format in January, Toshiba Corp. finally threw in the towel and admitted defeat – announcing it would no longer develop, manufacture or market HD-DVD players. The company said it would fully support HD-DVD units already purchased by consumers. Microsoft had already lowered the MSRP of its HD-DVD player for the Xbox 360 from $179 to $129 on Feb. 6,and slashed the price to $49 on Feb. 25.

Impact: With no HD-DVD to compete with, Blu-ray hardware is going to creep up in price. Microsoft will have no problem adding hardware support to the Vista operating system, but whether it will go out of its way to market an expensive Blu-ray optical drive add-on for the Xbox 360 remains to be seen. Microsoft is very happy with its high-definition downloads via Xbox Live, and until gamers start demanding resolution above 720p, there won’t be much incentive to embrace Blu-ray with the Xbox 360.