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3/19/2008
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Best Buy Offers Gift Cards To HD DVD Buyers

The retailer hopes to appease customers who ended up on the losing side of the high-definition video battle.

Trying to appease customers who ended up on the losing side of the recent high-definition movie format war, Best Buy on Wednesday said it would hand out $50 gift cards to buyers of HD DVD players.

By surrendering to Sony-backed Blu-ray last month, Toshiba-led proponents of HD DVD left player owners holding devices reduced to playing standard DVDs. To make amends, Best Buy plans to distribute more than $10 million in gift cards to people who bought players from the retailer before Feb. 23. The cards should start arriving by mail by May 1.

Brian J. Dunn, president and chief operating officer for Best Buy, said the format war divided customers in a way that the industry hadn't seen since Sony-backed Betamax lost to VHS in the battle for dominance of the videocassette recorder more than two decades ago.

"At Best Buy, we understood and shared our customers' frustrations as they were being asked to choose one format or the other," Dunn said in a statement. "Now that the format war is over, we hope these gift cards will reassure our customers that we will help them make a smooth transition into the right technology for their needs."

Best Buy plans to mail gift cards to customers the company can identify as HD DVD buyers. To do that, Best Buy will depend on information gathered through its membership program, purchases on the retailer's Web site, and the purchase of service plans.

Other customers with proof of purchase through a credit card or Best Buy receipt can request a gift card by calling 888-Best-Buy. "We're telling our customers they can keep their players to play these movies as well as their older DVDs and use the $50 to treat themselves to anything else in our stores," said Barry Judge, chief marketing officer for Best Buy.

While HD DVD players won't play Blu-ray movies, they enhance playback of standard DVDs by up-converting the video resolution, according to Best Buy. But those who want to get rid of their HD DVD players will be able to do so starting March 21 by visiting Best Buy's online trade-in center.

Visitors will receive estimates of the value of their players and HD DVD movies, and can download a prepaid shipping label to ship the goods back to Best Buy for an additional gift card for the estimated amount. This program is open to all HD DVD owners, regardless of where they bought their players.

Toshiba gave up the battle against Blu-ray four days after Wal-Mart, the world's largest retailer, said it would stop selling HD DVD movies and players by June. The turning point in the format battle, however, came in January when Warner Bros. Home Entertainment Group, which accounts for 20% of DVD sales in the United States, said it would ship all of its high-definition titles in Blu-ray by year's end.

Companies that dropped support for the Toshiba-backed format said it was necessary to eliminate customer confusion over having to choose between two competing and incompatible technologies. Most consumers have shunned high-definition DVDs and players to avoid being on the losing end of the format war.

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