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European Commission antitrust authorities are probing licensing conditions of the two high definition video disc standards, which are expected to enter the European market in 2007. The officials have reportedly launched “unofficial” probe and issue no demands or allegations.

“We have sent a letter earlier this month to the makers of HD DVD and Blu-ray to request information about licensing,” a Commission spokesman said, declining to give further information, Reuters reports.

The Commission demands to find out whether the licensing terms of the Blu-ray or HD DVD formats could break European Union competition rules, however no formal investigation was started, according to the news-agency.

The creators of the new DVD formats can license their products to both hardware manufacturers wanting to make new video disc players and disc producers themselves. Currently it is unknown whether the Commission is interested in a specific type of licensing, as officials decline to comment. Obviously, the Commission wants to find out whether the inventors of the Blu-ray and HD DVD formats and their fellow companies could monopolize the market of high-definition video discs in any way or whether the policies may be discriminatory.

It is not known which companies have been asked to provide information on the licensing terms, however, it is known that Sony had received the enquiry.

“There are no indications of any complaint, nor of any antitrust concerns on the part of the Commission or anyone else,” the company is reported to have said in a statement.

Once the EU’s top antitrust authority receives more information on the licensing terms from the companies concerned it could decide to either open a formal investigation or halt the case.

Traditional single-layer DVDs allow consumers to watch movies in 720x480 (NTSC) or 720x576 (PAL) resolution with Dolby Digital audio. The blue-laser discs will provide consumers 1920x1080 resolution as well as DTS or Dolby Digital Plus audio along with some additional interactive features.

Blu-ray and HD DVD formats compete for replacing the DVD standard. HD DVD discs can store up to 15GB on a single layer and up to 30GB on two layers. Its competitor, Blu-ray, can store up to 27GB per single layer and up to 50GB on two layers, but Blu-ray discs are more expensive to produce. The HD DVD is pushed aggressively by Toshiba and NEC as well as being standardized at the DVD Forum, which represents over 230 consumer electronics, information technology, and content companies worldwide. Blu-ray is backed by Sony and Panasonic, which are among the world’s largest makers of electronics. Among Hollywood studios HD is supported by Warner Bros. Studios, New Line Cinema, Paramount Pictures and Universal Pictures, whereas Sony Pictures, Walt Disney, Warner Bros. and Twentieth Century Fox endorse Blu-ray.


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