There is a difference between what Warner's move will mean to HD-DVD and what it will mean to mainstream consumers. Since NPD has shown just 11% of HDTV owners care about HD films, regardless of format, anoyone who says this will push blu-ray to sell much better is kidding themselves.

I want HD to go mainstream, even if it doesn't overtake DVD. I would like to see some films in HD, but so far blu-ray and HD-DVD are just DVD with a few gimmicks.

The point of this thread is what this move should encourage, in order to push HD to mainstream. So let's pretend we are in charge of one company or studio, and what we would do to push Hd development.

For me, if I was in charge of Toshiba, I would have HD-DVD not give up mainly for the sake of competition. If you look at the VHS vs Betamax, you would see that sales still grew for VHS, even with Beta around. What also grew was the tech. Beta kept coming up with ways to increase the length and quality of its tapes, and VHS kept up.

So if nothing else, HD-DVD should stick around for a while just to keep blu-ray from turning complacent. That's why I would have HD-DVD drop the MSRP of its movies. Sure it would stink of desperation, but mainstream HDTV owners wouldn't care, anymore than they cared that Nintendo rushed the DS, and then did a quick redesign.  Thus it would likely push sales. Now if it does, that would encourage blu-ray to follow suit, especially since the greater film library would mean more sales.

Secondly, since both formats are programmable, unlike DVD, I would have the best programmers I can get exploring what new features are possible, even if some require firmware updates (blu-rays have the space to just include them on the disc, even without internet connections). Blu-ray is already doing this with PiP, so HD-DVD can come up with a new thing, and blu-ray can add that, or vice versa. In the end, both formats would have some spectacular stuff, that DVD can't even try.

Space would be another factor. Now both sides push their disc capacities, but competition would just drive it faster. HD-DVD has the 51GB discs, and due to this move from Warner, I would make sure to get them out faster, which would in turn mean blu-ray would work on their triple and quadruple layer discs even harder.

Plus I would have all HD-DVD supporting studios get releases out much faster, even if it means more money. This would of course mean more blu-ray releases.

Now once HD movies hit mainstream sales, I mean 25% of the market, I would see what to do to end this. Assuming this happens to blu-ray and not HD-DVD, I would quietly phase out the format. If it happens to both, I would hammer out a truce. 

First, I'd like to say that I think your premise is going to happen already. While the format "war" may be over, there are still two fairly significant studios out there that are HD-DVD exclusive (besides SD formats). They will need to make the most of their investment for at least the remaining terms of their contracts. So here's what I'd do if I was in charge of lets say...Paramount.

New HD-DVD's are coming with web enabled content by virtue of having the player hooked up to the internet. I'd push that as far and as fast as I could. Web based flash games based on the movie content, perhaps even movie reviews, web-hosted video, whatever I can make happen. True, that content will only appeal to a subset of the customer base, but it will help. By making use of already available web content, I could even drive down my costs in production while still offering this "extra" feature. Unfortunately, I'm not educated enough on the technical capabilities HD-DVD has to offer (or Blu-ray for that matter) in this regard. The only thing I know is that Java is a programming language.....not sure about the HD-DVD side although I'd suspect it's at least similar.

The one issue I would have to contend with as an HD-DVD studio is this. Right now there IS confusion out there among consumers as when they pop in a regular SD DVD they often get an ad about "the future is Blu-Ray" or "the future is HD-DVD!" So, they're not sure exactly what the future is and may be hanging back on adoption. Now that this "war" is for all intents and purposes over...media outlets will be blaring that. Slowly, it will catch on in the consumer consciousness that "oh! Blu-ray IS the future, it's the next DVD." and they'll start adopting it.

To maximize my profits as an HD-DVD studio, I think I would need to shift my advertising away from proclaiming HD-DVD specifically and instead start touting my studio. For example "Paramount movie productions on high definition disk contain "x" features and the highest quality picture and sound!" That way I can distance myself from a name recognition that's proclaimed as the "loser" or "doomed" and instead get consumers to look at my products under the broader definition of "high definition video and audio" along with the features maximized for impact and production costs as per above. That would extend my profitability on the format, hopefully keep sales growing, and then allow me the flexibility in advertising once I'm able to switch formats. Then I'll be able to say "Paramount ALWAYS has had the highest quality video and audio as well as special features", etc, rather than being tied as much to the HD-DVD name.

Thoughts?

And of course the same should apply for blu-ray, even if they are in the lead, since the point would be for public awareness.