Microsoft to Stop HD-DVD Player Production, Cut Price (Update1)

Feb. 25 (Bloomberg) -- Microsoft Corp. plans to stop making HD DVD players and cut the price of existing supplies by more than half after the leading promoter of the high-definition video format conceded defeat to Sony Corp.'s Blu-ray last week.

``From tomorrow, we will cut the price to $49,'' said Grace Chou, a Taipei-based spokeswoman for the Redmond, Washington-based company. Microsoft's Xbox 360 game console includes a standard DVD player, and customers can buy an HD DVD machine to use with the console at $119.99 through retailers such as Amazon.com.

Microsoft, the world's largest software maker, was part of a group led by Toshiba Corp. supporting the HD DVD standard. Tokyo-based Toshiba on Feb. 19 abandoned its HD DVD business after the Blu-ray technology received support from major Hollywood studios including Warner Bros. Entertainment in the media industry's largest format war since VHS beat Betamax in the 1980s.

``It will not have a big impact because we don't sell HD DVD with the Xbox 360, only as an add on,'' Chou said.

The Xbox 360 trailed Sony's PlayStation 3 and Nintendo Co.'s Wii in U.S. game-console sales in January, according to researcher NPD Group Inc.

Sony includes a Blu-ray disc player in its PlayStation 3 game console.

To contact the reporter on this story: Tim Culpan in Taipei at tculpan1@bloomberg.net.

To contact the editor responsible for this story: Young-sam Cho at ycho2@bloomberg.net.