Jan. 7 (Bloomberg) -- Sony Corp. shares rose in Tokyo after Time Warner Inc., the world's largest publisher of DVD titles, chose to adopt the Japanese company's Blu-ray format over Toshiba Corp.'s technology.

The world's second-largest consumer electronics maker climbed 0.9 percent to 5,840 yen at 12:44 p.m. on the Tokyo Stock Exchange. Toshiba, the rival HD DVD standard's leading promoter, fell 2.5 percent to its lowest in more than nine months.

Time Warner's decision may tip the balance in Sony's favor in the home theater industry's biggest format war since VHS beat Betamax two decades ago. Warner Bros. Entertainment, which had been releasing movies based on both technologies, said last week it will drop Toshiba's standard at the end of May.

``It's a game-changing event, game over for HD DVD,'' Macquarie Securities Ltd. analyst David Gibson said in an e-mail today. Warner ``is the industry leader, and other studios will follow,'' he said.

Warner distributes more than 300 million DVDs a year, leading the industry, according to Gibson's estimates.

Toshiba is disappointed with Warner's decision, Keisuke Ohmori, a spokesman for the Tokyo-based company, said by telephone from Las Vegas today, reiterating comments in the company's Jan. 4 statement.

``We will assess the potential impact of this announcement with the other HD DVD partner companies and evaluate potential next steps,'' he said.

Joining Disney, Fox

Warner Bros., the second-largest studio in U.S. box-office receipts last year, joins Walt Disney Co. and News Corp.'s Fox in backing Blu-ray. The top studio, Viacom Inc.'s Paramount Pictures, DreamWorks Animation SKG Inc. and General Electric Co.'s Universal Pictures endorse HD DVD.

The North American HD DVD Promotion Group, which promotes the Toshiba-backed format, canceled a press conference on Jan. 5 in the U.S. after Warner's announcement. Blu-ray disks outsold HD DVD by two to one in the first half of 2007, according to Home Media Research.

``We think Warner prefers Blu-Ray because consumers have clearly chosen BD as the next-generation DVD format,'' Masayo Endo, a spokeswoman for Sony, said by telephone from Tokyo. She declined to comment on the impact on sales of Blu-Ray players in the U.S.

Warner's backing may also help sales of Sony's PlayStation 3 game consoles, which includes a built-in Blu-Ray player.

Sony today said it sold 1.2 million PlayStation 3 machines in the U.S. during the year-end shopping season. That's more than double the 466,000 PlayStation 3s sold in the U.S. in November, according to data from Port Washington, New York-based NPD.

To contact the reporter on this story: Mikako Nakajima in Tokyo at mikako@bloomberg.netYoshinori Eki in Tokyo at yeki@bloomberg.net

Last Updated: January 6, 2008 22:51 EST