Blu-Ray Religion Lessons Part 3: Remembering Microsoft Chrome

Rob Enderle

For two posts -- I only intended to do one, but the responses have been fascinating -- I've been trying to use the Blu-Ray train wreck in slow motion to help people avoid technologies that couldn't win and to showcase the dangers of becoming too invested in any technology and why analysis should come first.


I chose Blu-Ray because it was not an IT technology. I thought this site's readers could step back, see the lesson and not get too tied up in whether they agreed with the example. As it turned out, that wasn't a great assumption.


In the end, the feedback has provided better examples of the problems I wanted to showcase than anything I actually wrote.


However, for this final post, I'd like to talk about what we actually observed and how it can be applied to internal product development and -- because that seems like what folks want to talk about -- why Blu-Ray is probably obsolete (and that doesn't mean HD-DVD will win, either).


The Dangers of Technology Religion


If you look at the comments to both pieces, you'll see a lot of folks apparently didn't actually read what I wrote, didn't see what kind of a site this was, and assumed -- because they rabidly supported Blu-Ray -- that somehow I was promoting HD-DVD and being paid to do so, which isn't true at all.


Throughout I constantly suggested the problem for Blu-Ray and HD-DVD was the market was about to bypass both and that Blu-Ray either couldn't get to the proper price fast enough and/or knock out HD-DVD fast enough to prevent it.


Take a nationalistic view for a moment. At the beginning of the year, Japan had two out of two shots to capture the majority of the royalties associated with this next generation of technology. But I believe the industry is poised to jump to download, which is based largely on non-Japanese technology, and that shifts that country's odds to close to zero.


That means the fight itself will assure Japan as a nation loses what could be a lucrative revenue stream estimated to be in the tens of billions of dollars.


I've seen fights like this within companies, where two groups will undermine each other and will seem to care more about assuring the other insider loses than whether the company wins. Often, the result of that is the company loses after wasting a ton of resources on infighting.


This Blu-Ray-vs.-HD-DVD battle is like that. The two sides should come together because part of something is always better than 100 percent of nothing. But they are choosing to follow the Laser Disk into extinction, denying both companies and their country the related revenues because the two key players can't reach agreement. It doesn't matter whose fault it is, the national embarrassment of betraying their own country in this way should be driving the two sides together, but it isn't.


Of course, it is good for the United States, and since that is where I live, perhaps I should point this out less and enjoy it more.


Microsoft Chrome Example


One of the most disappointing moments in my life was when Chrome failed at Microsoft due to infighting. Chrome -- and there is actually a great book on what happened -- was an amazing technology. Created as a joint project between Microsoft and Intel, it could have formed the foundation for everything from online video, to massive multi-player games, to rich software-as-a-service architectures supporting heavy graphical applications (think of CAD/CAM as a viable hosted service with unlimited processing power).


The potential for this technology was greater, in its time, than anything I'd ever seen, but politically it went against the PC- centric beliefs of powerful executives in Microsoft and was killed. (Parts of it live on in Flash).


If you had seen how revolutionary the technology was in its time and how it could have transformed the company, possibly single-handedly countering the belief that Microsoft couldn't innovate, you would better understand the massive damage Microsoft did to itself over politics. In a way, Silverlight is the new Chrome, but so much time has been lost in the meantime.


I could point to the fact that the PC division at IBM has a better version of OS/2 than the software division did and that it lost out because of politics, or that Siemens, after it acquired ROLM, powered through a politically backed product that failed so spectacularly it set records for red ink. But, you probably have your own examples of why, when these fights occur, an independent, trusted body needs to step in and make a decision based on what is good for the company. Endless fights are pointless in all cases, and generally it's better for the inferior offering to win than for neither to win.


Blu-Ray/HD-DVD vs. What's Next


If you pick up Popular Science this week, its featured product for movies is not Blu-Ray or HD-DVD, but Vudu, an excellent download service tied to a set-top box that costs about as much as the least expensive Blu-Ray player. It has a good built-in up-converter and reviewers report the result is more than acceptable on HD TVs. With an excellent user interface and 5,000 movies, both for purchase and for rent, it is arguably the best download solution on the market.


If you like disks, HD-VMD has just popped up. It's vastly cheaper to manufacture both players and disks than either HD-DVD or Blu-Ray -- initial players are about $150 and the price will drop. It lacks much of a library, but has support from a variety of studios. This would be more like what DVDs did to Laser.


Microsoft (HD-DVD), Apple (Blu-Ray), Cisco (neither), Google (neither) and Intel (HD-DVD) are all focused like lasers on download as the next big model and none seems all that interested in Blu-Ray or HD-DVD from a funding or staffing level anymore. Both formats appear obsolete and these heavyweights are moving to download.


Wrapping Up: What Should Happen?


Both sides of the HD-DVD/Blu-Ray battle should sit down with a trusted arbitrator and present a shared deal to the other to exit the market. The arbitrator would pick the most balanced option that's most likely to succeed and both sides could walk away with close to 50 percent of the available market. It still has a shrinking chance to be lucrative as opposed to their current track, which promises 100 percent of nothing long term.


The challenge for you is not which of these technologies to buy, but to avoid this kind of lose/lose situation in your own companies and to stay focused on what is best for your company and not just on who is right. Being right means very little if you are on the wrong side of a layoff or company failure.

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