HD DVD Cost Toshiba Dearly, Profits Sink 95%

You don’t just create a failed disc format, plug in a global advertising campaign, then adopt a late-in-the-game scorched Earth policy on prices without losing your shirt in the process.

That’s exactly what’s happened to Toshiba this year. The company that once announced over 26 billion Yen in profits is down to about 1.25 billion. Converting that profit to $US it amounts to only about $12 million. That’s a tough disc to spin for a world class consumer electronics company that builds everything from truck batteries to ultrasound equipment.

The company also suffered from sudden drops in flash memory prices. Those little memory inserts for your PDA and digital camera have never been cheaper.

Thomas Ricker at EngadgetHD.com points out that what’s bad for Toshiba is great for us consumers. At least we get cheap memory and finally a unified high definition optical disc format out of Toshiba’s loss.

Sorry Toshiba, may 2008 smile brighter upon thee.

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