Rival HD camps fight over pricing

But Jodi Sally, vice president of marketing for Toshiba's Digital AV group, a key supporter of HD-DVD, dismissed suggestions of a panic move.

She said that the decision was based on consumer research, which looked at what price would accelerate the adoption of players.

'We received such an excellent response from retailers that we were able to increase our production efficiency and so were able to lower the price.

'We also developed a $499 model as consumer research indicated that was a price that created a more mass market acceptance among consumers.'

Both companies have players due out in spring, with others also planning products within a similar timescale. Panasonic has both a Blu-ray player and dual-layer drive for PCs out in the summer.

Reid Sullivan, vice president of merchandising entertainment at Panasonic, said: 'Awareness of high definition is growing considerably. Consumers are looking for next generation high definition media to enjoy on their plasma and digital TVs.'