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DVD Certainly Dazzles, but High Cost Is Stalling Its Acceptance

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SPECIAL TO THE TIMES; David Pescovitz (pesco@well.com) is the coauthor of "Reality Check," a book based on his monthly column in Wired magazine

A familiar high-tech variation on an age-old conundrum is stalling acceptance of the much-heralded computer storage medium known as DVD-ROM: Which comes first, affordable hardware or a wealth of software? The installed base or the content providers?

Depending on whom you ask, the DVD in DVD-ROM stands for digital versatile disc or digital videodisc. It’s a variation on the DVD movie playback system, which itself has been plagued by a shortage of titles.

Many in the computer industry had assumed that DVD would quickly displace the venerable CD-ROM as a medium for PC software and especially graphics- and video-rich multimedia software. DVD-ROM looks and acts very much like a CD-ROM--point, click and travel down a branch of your choosing in an adventure game, multimedia encyclopedia or national telephone directory--but it has far more capacity.

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Capable of storing 4.7 gigabytes of data--compared with 650 megabytes for a CD-ROM--a DVD can hold more than two hours of full-motion video and Dolby surround-sound stereo, making for an interactive movie that’s more exciting than most of the offerings at the multiplex.

Today though, those benefits are not worth the added cost for most consumers. Internal DVD-ROM drives that also play CD-ROMs and music CDs are available only on high-end personal computers from the likes of IBM, Compaq and Packard Bell and sold as upgrade kits from Creative Labs and Diamond Multimedia for about $600.

The price is high because, unlike with CD-ROMs, you’re not just paying for the drive but for a several-hundred-dollar add-in card to decompress the data and unscramble the DVD’s copy-protection codes.

“We’re thinking the crossover point when DVD-ROMs replace CD-ROMs may not be until the year 2000,” says Mary Bourdon, a technology analyst with the market research firm Dataquest. “Right now, PC manufacturers don’t want to bring up the price of low-cost personal computers, which they’d have to do to add a DVD hardware card and pay for the licenses required of DVD.”

At this point, the DVD market is “a game of wait-and-see,” Bourdon says. While early titles like those from Activision, Discovery Channel Multimedia and Origin are impressive, most software companies aren’t ready to drop big bucks into pricey DVD-ROM production until an installed base exists.

“We’re not jumping in head-first yet,” cautions Tom Burke, Discovery Channel Multimedia’s vice president of marketing, even though the company’s Animal Planet DVD-ROM gathered crowds at the recent E3 show with its encyclopedic information and crystal-clear, full-screen panoramic footage of pythons, leopards and other beasties.

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“We’ll be there, but we’re going to wait for the technology’s market penetration before you see a long list of upcoming DVD-ROM titles from us,” he says.

Hoping to overcome such reticence, DVD-ROM manufacturers such as Toshiba, Sony, Philips and Hitachi are scrambling to bring DVD prices down. One key to lower costs is to eliminate the need for the expensive DVD-ROM hardware card, and several companies--including Santa Clara, Calif.-based Zoran--are using the processing power of Intel’s Pentium MMX chip to design a software solution for DVD decoding.

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According to Intel, software decoding will bring DVD-ROM prices down to a point where they will replace CD-ROMs much sooner than Bourdon predicts.

“Imagine going into a store to buy a computer that has a DVD-ROM drive in it, and one of the models just happens to be $500 less because the extra hardware has been eliminated,” says Chris Lane, Intel’s DVD product manager.

The title Lane demonstrated to show off the quality of the software solution, however, wasn’t a multimedia issue. It was a DVD of a Hollywood film. And as Bourdon says, “who wants to watch a movie sitting at their desk?”

Meanwhile, Hitachi and Matsushita Electric Industrial raised even more intellectual property concerns with last month’s announcement of recordable DVD-RAM drives. The consumer DVD-RAM drives, sold as samples to PC makers for less than $1,000, can hold 2.7 gigabytes of data per side and be used over and over.

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Despite the problems, some software developers remain enthusiastic. “One of the things we’ve always tried to do since moving to Los Angeles is get to the point where the production values incorporated into our games would rival feature films and television,” said Robert Kotick, founder and CEO of Activision, creators of “Spycraft: The Great Game” and the “Muppet Treasure Island” DVD-ROMs.

“For the first time we have the storage and compression capabilities that give us TV-quality production values.”

By the time DVD-ROM and DVD-RAMs have replaced CD-ROMs and other removable storage media in large numbers, though, manufacturers will already be experimenting with even better formats. Already, Sony announced that by 2000, it plans to commercialize a disc system that can pack 12 gigabytes of data on one side of a standard-size CD.

And that means that DVD, still an infant, is already in a race against the clock.

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