HD-DVD vs. Blu-ray, Zune2 vs. iPod Classic

This week ends with one of the most important days of the year. It's called "Black Friday," and it could decide the future of a lot of battles and tell us whether this will be a good or bad season economically.
There are two big battles that may actually be decided this week based on initial sales numbers. For Microsoft (Nasdaq: MSFT) , which had its butt kicked last year by the iPod, this is its chance to show it gets it and to take the fight to Apple (Nasdaq: AAPL) .
For HD-DVD and Blu-ray, this is when Wal-Mart (NYSE: WMT) steps in and tries to do to this market what it did to TVs last year. There is a reasonable chance HD-DVD will exit the winner; however, Blu-ray isn't sleeping, and Sony (NYSE: SNE) is initially using Amazon (Nasdaq: AMZN) to help its case.
Since Black Friday is when a lot of you will be out buying, I'm going to provide some advice on what to look for and some choices you may not have thought of, and suggest that you not wait until Friday to buy at least one item.
Finally we'll close with one of my favorite products for the year: the new HP (NYSE: HPQ) Home Server, which has evidently outsold even laptops on Amazon for its first week.
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Battle One: Blu-ray vs. HD-DVD
The most widely watched battle that will be fought this Friday is the one between Blu-ray Disc and HD-DVD. To catch you up, right now both platforms are selling well below 10 percent of potential because of the conflict that exists between them. Last year, the two sides went back and forth, with HD-DVD in front at the start Blu-ray in front in the middle, and both basically tied now with momentum back in the HD-DVD camp.
In advance of Black Friday, Blu-ray has launched a two-for-one deal with Amazon, which should push disk sales up sharply. This isn't as good as it initially looks because you can't mix and match between Sony and Disney (NYSE: DIS) films. Still, revenue could actually decline for Blu-ray at the same time depending on whether this results in a doubling of sales volume. Also, PC Blu-ray drives just dropped below $200, which suddenly makes PCs with both HD-DVD and Blu-ray drives a possibility and should push sales on PCs anyway.
However, on Black Friday, Wal-Mart is expected to go very aggressive, with HD-DVD player prices dropping well below $200. While disk sales are important tactically, player sales are strategic. Given that the PS3 isn't expected to be hot this year, if they execute as expected, the battle could drift so solidly into the HD-DVD camp that the fight will be over.
Now, the HD-DVD camp will need a better than 4x sales rate over Blu-ray to do this, but Wal-Mart alone is capable of exceeding this volume and demonstrated that with TVs last year, so this thing could be over by year end. I stress the word "could," however, as the Blu-ray guys clearly see this coming and may not have played all their cards yet. The good news is that under $200, the things aren't that bad a risk.
Battle II: Zune II vs. iPod Classic and Nano
The other battle is Zune II line vs. the iPod classic and the iPod nano. Last year, there was no competition, and Apple kicked Microsoft's butt all over the segment.
Now, Microsoft is back with a new set, and they have a shot. Now, there is no doubt that the iPod touch is the hot product, but it is $400 for the configuration (16GB) that folks want. However, that is way out of the price range for gifts, which typically fall closer to the $200 range. This means, though they aren't as flashy as the touch, the iPod classic and the iPod nano have to carry the weight.
Who wants something called "classic" as a gift? You might as well keep whatever you've got because "classic" generally means obsolete. The nano has gone from being this little thing that looked incredibly cool to something that looks like a large and less attractive version of the iRiver Clix2.
All iPod products have a nasty history of being relatively fragile and are known for scratching badly. None has an FM radio or supports subscription-based music. The new Zunes hit solidly on all points, as they are scratch resistant, have FM radios, support subscription music and wirelessly sync.
The Zune music service is a complete rewrite and vastly better; the new Zunes support more video media types, so video transfer is much quicker -- as in minutes for movies and not hours -- and the new user interface makes you wish this Zune UI group would talk to the Windows group from time to time.
This is why the new Zunes are winning some favorable initial reviews. If they'd done this last year, I'd be more sure of the outcome. This year they have to overcome perceptions from last year, but it's a good product and a good value, let's see if the market bites.
Black Friday Advice: Buy Wii Now
OK, if you are even thinking of buying a Wii , get up and go to the store now. If you wait until Friday, you are likely going to either pay a massive premium or wait until February to get your Wii -- and kids are not particularly forgiving if you miss Christmas.
TVs are expected to be the No. 1 product this year, as they were last year -- typically prices drop sharply after Christmas as people try to eliminate inventory before year end and they will drop again after the Super Bowl here in the U.S.
If you want something sooner, try the sites that have a good reputation with regard to seconds, like Tiger Direct, as they can have incredible deals on products that were current only a few weeks ago. I saved $4,000 by doing this last year myself. That saved me enough to almost be able to afford the Wii before Christmas. I've also found a great site to do research before you buy and ensure you get the best TV at the best price.
Laptops are hot -- according to several surveys they are either No. 1 or 2 on the list of things folks want. If you buy online, you can often get special colors and some of the newest products are initially online only.
The two products I'm personally excited about that come in colors are the Dell (Nasdaq: DELL) Red, White, or Black XPS 1330, which has advanced options of LED backlit screens and solid state drives (think expensive, really fast and silent); and the more affordable Red, Blue or Black Gateway (NYSE: GTW) m-150XL, which is larger and has HDMI out so you can watch YouTube videos with it on your TV. Or you can do as I do and watch DVDs in hotel rooms, which have new TVs in them.
Both products represent the leading designs from their respective companies and should put a smile on the face of whoever receives them. The Dell is a technology powerhouse, and the Gateway is one of the best deals in laptops this quarter.
Digital picture frames are not only affordable (around $80 for 7" to $300 for 15") this year, they are the most personal thing you can give a relative or close friend. Preload one with pictures that mean something to them -- some will even play music -- and you can give a unique gift that will last on the desk or credenza for years. Look for those that have LED backlights because they will look better and last longer. These make a wonderful gift that particularly parents and grandparents will enjoy.
Product of the Week: HP MediaSmart Server
Now, if someone had come to me two years ago and told me I'd be excited about a server for the home I'd have them checked for substance abuse issues. I'm as surprised as you are that a server for the home makes sense, but darned if Windows Home Server doesn't. This thing not only is the best home backup solution (it will restore files and whole systems) it also does a great job of giving you a custom Web site where you can get access to and share your stuff (without fear of censors) and it's a great hub for moving media around your home.
I have one with 3 Terabytes of storage (I'm only using a fraction of this), and it is wonderful. Microsoft and HP actually created an interface on top of Windows Server 2003 that makes the MacOS interface look complex.
Right now, the HP version of this product is by far the best with redundant drives, low power requirements and extensive expansion capability. It even looks really good.
Evidently it was one of the hottest things Amazon was selling the week of the launch and this is even before a number of in-the-works applications arrive. After the California fires, I'm into anything that keeps our data safer. If you get one, check out a product called "JungleDisk" -- it won second place in a third-party software contest for Windows Home server and will back it up to Amazon S3.