Toshiba Throws In The Towel

Just last week, I was predicting the hi-def disk format war to end very soon. This was based on Net-Flix choosing an exclusive format for its hi-def movie rentals. Later in the week, Walmart announced its decision to sell Blu-ray exclusively for movies and players. Over the weekend, Toshiba execs floated the rumor that they would announce ending production on HD-DVD disks and players, and today, their investors reacted to the rumor as if it was very good news. The article mentions the surge in stock price, and also consumers waiting for the format war to end, which was actually prolonging the format war, since the open market was not showing a clear winner from straight sales. Toshiba learned a hard lesson about marketing a new media format, something which Sony had learned about twenty years ago. Something not mentioned in the Reuters piece, Toshiba's new media format direction: high-capacity flash drives. We've been sticking disks the size of CD's into slots for twenty years also, but with the prevalence of portable media players much smaller than those disks, who do you think is better positioned to grow into that market sector?