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Tuesday, February 19, 2008, 11:25 am PT (02:25 pm ET)

Game over: Toshiba pulls plug on ailing HD DVD format

Following a thorough review of its overall strategy, Toshiba Corporation said Tuesday that it will no longer develop or manufacture HD DVD players, marking an end to the battle against Blu-ray for supremacy as the next-generation optical disc format.

The move comes just days after mega-retailers Wal-Mart and Best Buy, as well as movie rental service Netflix, abandon support of the format in favor of Blu-ray. Earlier in the year, major motion picture studio Warner Bros. announced similar plans, with Paramount and Universal rumored to eventually follow.

"We carefully assessed the long-term impact of continuing the so-called 'next-generation format war' and concluded that a swift decision will best help the market develop," said Atsutoshi Nishida, President and CEO of Toshiba Corporation. "While we are disappointed for the company and more importantly, for the consumer, the real mass market opportunity for high definition content remains untapped and Toshiba is both able and determined to use our talent, technology and intellectual property to make digital convergence a reality."

As a result, the Tokyo-based firm said it will focus its efforts on technologies that will drive mass market access to high definition content, such as high capacity NAND flash memory, small form factor hard disk drives, next generation CPUs, visual processing, and wireless and encryption technologies.

Toshiba will begin to reduce shipments of HD DVD players and recorders to retail channels immediately, aiming for cessation of the businesses segment by the end of March 2008. The company also plans to end volume production of HD DVD disk drives for such applications as PCs and games in the same timeframe, yet will continue to make efforts to meet customer requirements.