The move will leave Universal as the lone major Hollywood studio backing the HD DVD format and presumably conclude a multi-year battle for supremacy in the home entertainment market, leaving HD DVD to suffer the same fate as Sony�s now obsolete Betamax video technology when it lost out to VHS in a similar format war back in the 1980s.
As noted by the FT, Paramount and DreamWorks Animation -- makers of the Shrek series of films -- came out in support of HD DVD last summer, joining General Electric�s Universal Studios as the main backers of the format.
However, Paramount is understood to have a clause in its contract with the HD DVD camp that would allow it to switch sides in the event of Warner Bros. backing Blu-ray, the financial paper said, citing people familiar with the situation.
It's reportedly unclear whether DreamWorks has the same get-out clause in its contract with the HD DVD camp, but the animation studio maintains a close relationship with Paramount as the distributor of its films on disc.
For its part, Universal has remained mum on its forward looking plans for high-definition video discs and has declined to comment on the situation since Warner Bros. announced its intention to drop HD DVD support last Friday.
Update: According to Bloomberg, Paramount has denied the report by the Financial Times.
"Paramount's current plan is to continue to support the HD DVD format,'' Brenda Ciccone, a spokeswoman for Paramount, said in an e-mail.
Meanwhile, Keisuke Ohmori, a spokesman for Tokyo-based Toshiba, called the Financial Times' report "speculative."
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