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In the early 1990s two high-density optical storage standards were being developed: one was the MultiMedia Compact Disc (MMCD), backed by Philips and Sony, and the other was the Super Density disc (SD), supported by Toshiba, Time-Warner, Matsushita Electric, Hitachi, Mitsubishi Electric, Pioneer, Thomson, and JVC. IBM's president, Lou Gerstner, acting as a matchmaker, led an effort to unite the two camps behind a single standard, anticipating a repeat of the costly format war between VHS and Betamax in the 1980s.

Philips and Sony abandoned their MMCD format and agreed upon Toshiba's SD format (not to be confused with secure digital cards) with two modifications that are both related to the servo tracking technology. The first one was the adoption of a pit geometry that allows "push-pull" tracking, a proprietary Philips/Sony technology. The second modification was the adoption of Philips' EFMPlus. EFMPlus, created by Kees Immink, who also designed EFM, is 6% less efficient than Toshiba's SD code, which resulted in a capacity of 4.7 GB as opposed to SD's original 5 GB. The great advantage of EFMPlus is its great resilience against disc damage such as scratches and fingerprints. The result was the DVD specification Version 1.5, announced in 1995 and finalized in September 1996. In May 1997, the DVD Consortium was replaced by the DVD Forum, which is open to all companies.

"DVD" was originally an initialism for "Digital Video Disc." Some members of the DVD Forum believe that it should stand for "Digital Versatile Disc" to reflect its widespread use for non-video applications. Toshiba, which maintains the official DVD Forum site [1], adheres to the latter interpretation, and indeed this appeared within the copyright warnings on some of the earliest examples. However, the DVD Forum never reached a consensus on the matter, and so today the official name of the format is simply "DVD"; the letters do not officially stand for anything.

Warner Home Video and Toshiba introduced the new format to Wall Street types, Hollywood big wigs and the investment community at an elaborate staged event on the Warner Bros. lot, hosted by Warner Home Video then President Warren Lieberfarb. The production included the first ever interactive DVD menu designed by producer Billy Pollina. The first DVD players and discs were available in November 1996 in Japan, March 1997 in the United States, 1998 in Europe and in 1999 in Australia. The first pressed DVD release was the film Twister in 1996. The film had the first test for 2.1 surround sound. The first titles released in the U.S., on March 19, 1997, by Lumivision, authored by AIX Entertainment, were IMAX adaptations: Africa: The Serengeti, Antarctica: An Adventure of a Different Nature, Tropical Rainforest, and Animation Greats.

By the spring of 1999 the price of a DVD player had dropped below $300 US. At that point Wal-Mart began to offer DVD players for sale, but DVDs represented only a small part of their video inventory; VHS tapes of films made up the remainder. Wal-Mart's competitors followed suit, and DVDs began to increase in popularity with American consumers.

DVD rentals first topped those of VHS during the week of June 15, 2003 (27.7 M rentals DVD vs. 27.3 M rentals VHS). Major U.S. retailers Circuit City and Best Buy stopped selling pre-recorded VHS tapes in 2002 and 2003, respectively. In June 2005, Wal-Mart and several other retailers announced plans to phase out the VHS format entirely, in favor of the more popular DVD format. However, blank VHS tapes are still widely available since DVD video recorders are significantly less common than DVD players. Many films released to theaters from 2004 onwards are released solely to DVD format and not to VHS format. Consumers have predicted that 2006 would be the final year for new releases on VHS.

While the growth of theatrical films on DVD has cooled recently, that of television programs and music video has increased dramatically. The price of a DVD player has dropped to below the level of a typical VCR (although DVD recorders are still usually more expensive than VCRs); a low-end player with reasonable quality can be purchased for under $35 US in many retail stores and many modern computers are sold with DVD-ROM drives. Also popular are units that have integrated a DVD and VHS VCR into a single device; these can be purchased for under $100 US. Most, but not all, movie "sets" or series have been released in boxed sets, as have some entire seasons or selected episode volumes of older and newer television programs.


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