Sanyo plays both sides of high-def DVD fight

updated 8:00 p.m. ET June 14, 2005

TOKYO - Japanese consumer electronics maker Sanyo Electric Co. has joined a group of companies led by Sony Corp. to develop recordable high-definition DVD disks, but will also remain allied with a rival group, a report said Tuesday.

Sanyo's decision to help both the Sony-led group and its competitor adds uncertainty to the race to develop a global standard for next-generation optical disks, which are expected to offer sharper images than current DVDs.

Sony leads a group promoting the Blu-ray Disc format, while Japan's Toshiba Corp. leads a rival group that backs the HD-DVD format.

Sanyo quietly joined the Blu-ray Disc side in April, while retaining its ties to the HD-DVD group, the Kyodo news agency quoted the company's officials as saying Tuesday. It plans to have a DVD player compatible with the HD-DVD format on store shelves later this year.

The news follows Toshiba's announcement last week that it is preparing to mass produce recordable high-definition DVDs with a 15-gigabyte storage capacity. Hitachi Maxell Ltd. and Mitsubishi Kagaku plan to market the new discs next spring, when Toshiba is scheduled to launch the new DVD recorders.

Sanyo plans to make a key part of the machines that reads the discs for both formats _ apparently hedging its bet, as the two groups pour resources into a technology that is expected to revolutionize Hollywood movies and consumer electronics.

A Sanyo spokesman couldn't be reached after the company's headquarters in the western city of Osaka closed for the day. At the Tokyo Stock Exchange, Sanyo shares fell 1 yen to 272 yen ($2.50).

Blu-ray has more capacity, with 50 gigabytes, compared to 30 gigabytes for HD-DVD read-only disks, but proponents of HD-DVD say their format is cheaper to make because the production method is similar to current DVDs.

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