TOKYO , Japan ( CNN ) -- Toshiba said Tuesday it will no longer manufacture HD DVDs , effectively ending the long-running battle with the rival Blu-ray for a dominant high-definition format . People watch a demonstration of HD DVD at the 2008 International Consumer Electronics Show in Las Vegas . Toshiba said it made the decision to cease developing , manufacturing , and marketing HD DVDs after `` recent major changes in the market . '' It promised to continue offering support and service for all existing Toshiba HD DVD products . `` We carefully assessed the long-term impact of continuing the so-called 'next-generation format war ' and concluded that a swift decision will best help the market develop , '' Toshiba President and Chief Executive Atsutoshi Nishida said in a news release . Toshiba 's HD DVD business has been suffering recently with a string of major retailers and rental companies announcing their preference for Blu-ray , developed by Sony . Watch video on the battle of the formats » . Last week alone , Wal-Mart and online rental company Netflix said they would abandon HD in favor of Blu-ray . Last month , Warner Brothers Home Entertainment -- which had been the largest media company releasing videos in both formats -- announced it would offer DVDs solely in Blu-ray . The DVD battle has been reminiscent of the VHS vs . Beta fight in the early 1980s . It has left many consumers confused and waiting to see which technology will emerge as the industry standard . Sony 's Blu-ray is backed by Disney , 20th Century Fox , MGM , Dell , Panasonic , and Philips . Toshiba 's HD DVD is backed by Paramount , Universal Pictures , Microsoft , Sanyo , and NEC . Toshiba said it would continue to work with those companies and study ways to collaborate with them in the future . Tens of billions of dollars have been at stake as major movie studios battled for a dominant format . But rival game consoles have been part of the struggle , too -- Sony 's Playstation 3 plays Blu-ray discs , while the Microsoft Xbox will play HD DVDs if users install an add-on component . Both Blu-ray and HD are high-definition DVDs , the successor to ordinary DVDs which show pictures only in standard definition . But Blu-ray and HD involve different hardware and are not compatible with each other , meaning consumers have had to decide which system to invest in . Both formats have an excellent picture quality with a large storage space . But Toshiba has lost the battle because it lacks a retail presence in many markets , said Carl Gressum , a senior analyst at Ovum , a London technology consultancy . `` They did n't manage to bring on board some of the China vendors , they did n't bring ( on board ) the retailers , they 've failed to develop in the European and Asian markets , '' Gressum told CNN . Warner Brothers announced its decision to drop HD DVD right before last month 's International Consumer Electronics Show in Las Vegas , a significant event for corporate buyers . Gressum said that led to an immediate drop in retail support for Toshiba 's format . Gressum said manufacturers of both formats have made things more difficult for retailers by forcing consumers to make a choice between the gradually-dominant Blu-ray and the much-cheaper HD . `` They 're losing money in many cases because of the price war between the two formats as Toshiba -- and also Microsoft , to a certain extent -- has been playing the price card for HD DVD players , '' he said . Toshiba said the company would continue to market standard DVD players and recorders . E-mail to a friend .
Toshiba says it will no longer make or sell HD DVD players and recorders . Move delivers victory to using Sony 's Blu - ray disc technology for next - generation video . Toshiba lost because it lacked retail presence in many key markets , he said .