What if the multiple soundtracks and high-definition bonus materials won't fit on a single disc?

If there's an overflow of bonus material, we'll just go to another disc. That's not an issue for consumers. In some cases, they consider that it has more value. It's done routinely in DVD. Why put every single title on a high-capacity disc if it doesn't need it?

Do you expect capacity needs to change in the future?

A 45GB disc is under development. [Editors' note: This disc has been in development for two years.] Secondly, compression will become more effective. The number of minutes you get on a disc depends upon how much you can compress a movie. As we gain experience with the new codecs, the ability to compress at high quality will be improved.

Capacity is a factor, but it's not an overriding factor. In the grand scheme of things, the better proposition for consumers in our view, and for our business needs, is HD DVD.

From your first-hand experiences, what can you tell us about the difference in programming languages between HD DVD, which uses Microsoft's HDi technology, and Blu-ray, which uses BD-Java?

BD-Java is a programming language. The benefit is that it's very flexible. The drawback is that you may need 100 lines of BD-Java code. HDi is a relatively compact piece of code; one command can cover quite a bit of interactivity.

BD-Java is also more complex, so the possibility of errors is greater. And when BD players are put out, [there's the question of whether] they all support the scenarios as coded up from the low level. [Some of the early problems with BD-Java discs] were in part due to the complexity that BD-Java brings. From our point of view, HDi offers all of the flexibility we need, in practice, and it does so in a more simplified way and in a way that we feel leads to better compatibility, better reliability, and lower costs.

Up until now, how have you approached coding your discs for HDi and BD-Java?

At this particular point in time, we've been able to supply more features with HDi and HD DVD than with BD-Java and Blu-ray Disc. What we have typically done in practice is that we've created the interactive scenarios in HD DVD and then tried to pull them into Blu-ray. But that has not been entirely possible: Some things we can do in HDi are not supported in BD-Java. If you're going to do BD-Java, you need someone who's capable of programming at a low level. With HDi, you don't need somebody with that additional level of training. We don't need programmers to code our discs.

Do you think users are interested in the interactivity on these discs?

Bell: Interactivity is an important part of why you would move up from DVD. Yes, [high-def] has a great picture, but is that enough? Connectivity is something that studios will grow into, and it's something that we believe studios will grow into.

We're thinking about [having media servers to provide extra content via the Internet], but those kinds of investments cost money. The motivation to do them grows as the installed base grows. If we see there's a sufficiently large installed base to justify the cost of the server, we'll do it. Right now we're concentrating on getting a great picture out, and great interactivity.

Will this exclusive period extend for a limited time, or is this an indefinite arrangement?

At this moment in time, it's an indefinite commitment. The core of this announcement comes from our experience, and what our consumers are looking for. We hope this will influence consumers' choices.