The purchase of Metro-Goldwyn-Mayer, by a group led by Sony, may give the company an enormous film library and considerable clout in its fight to set the format for the next generation of digital video discs targeted at HD movies.
The transition to the new discs could generate billions of dollars in royalties to the developers of the technology that runs them.
Sony, as part of the Blu-Ray Disc Association, a consortium of major electronics manufacturers, is at the forefront of efforts to develop the new technological standard. A rival HD-DVD group, led by Toshiba and NEC, is promoting its own format, which is incompatible with the Sony Blu-ray format. Both formats have the ability to store large amounts of audio data, including 7.1 surround and up to 192kHz audio.
As with the battle between VHS and Beta nearly 30 years ago, the ability of a new format to line up content will prove critical, and Sony's purchase of MGM gives it upwards of 4000 catalog titles it could use as leverage to promote the Blu-Ray format.