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Executive Summary
Between 2006 and 2008, electronics giants Sony and Toshiba were locked in one of the greatest
format wars since the start of the 21st century, to determine which would emerge as the ultimate
standard of the high definition optical disc. Both companies attracted the support of major
manufacturers of electronic and Hollywood studios but in the end, it was Toshiba who conceded
defeat after Sony’s careful management of the innovation process proved to be too much for
them. This report will look at some of the strategies employed by Sony as it relates to creativity
and innovation.
Table of contents
1. Introduction 3
2. The determinants of Format Wars 3
3. Business Sectors & different formats 3
4. CIM and Innovation 4
5. Playstation: The First Blu-ray player 4
6. Major factors in Blu-ray’s victory 5
7. Contributing industries to the format war 6
8. Blu-ray and the future 6
9. Implications for firms engaged in format wars 7
10. List of key factors that determine the winner in format wars 8
11. Failure to innovate 8
12. Sony and its resource-based approach 8
13. Betamax: Sony’s invention or innovation? 8
14. Typologies of innovations used 9
References 9
1. Introduction
After coming off a huge defeat with its superior Betamax technology to JVC’s VHS,
Sony became engaged in another format war – this time with Toshiba and its HD DVD.
This time around, Sony learnt from its failure four decades ago and approached their new
Blu-ray technology creation and products with a more innovative than inventive strategy.
This report will explore various essential aspects employed by Sony in an attempt to fully
understand the strategies used by Sony in relation to creativity and innovation.
2. The determinant of Format Wars: best technology or being first on the market?
The case of Sony’s Blu–ray technology vs. Toshiba’s HD DVD (Trott, 2008) gives us a
brief history of the last time Sony was engaged in a format war and turned out to be the
losers. In the 1970s, Sony’s Betamax technology lost out to JVC’s VHS format and the
evidence presented in this case illustrates that in some situations it is neither the best
technology nor being the first in the market that determines the eventual winner of a
