Toshiba officially scraps HD-DVD

Toshiba has finally announced the discontinuation of its HD-DVD format today after several days of intense speculation.

The decision was made in a board meeting in Japan earlier today, with "major changes in the market" - referring to the Hollywood studios and retailers siding with Blu-ray - the reason for its change of heart.

"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, big boss at Toshiba.

"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."

Its efforts will now be focused on improving things like flash memory, hard disks, CPUs, visual processing and encryption technology.

Shipments of HD-DVD players and recorders will slow to a trickle and stop altogether by the end of March, although Toshiba will continue to offer support and after-sales service for products already sold.

It will also continue relationships with previous partners like Microsoft, and look for new ways to work with them in the future.

So far it's unclear what impact the discontinuation of the format will have on the Xbox 360 HD-DVD add-on. Microsoft has previously said it would announce its plans after Toshiba made its mind up.

The move clears the way for Sony and its Blu-ray technology, and is likely to produce strong knock-on effects for PlayStation 3 console sales.

Analysts have suggested the PS3 will nearly double its installed base by the end of the year.