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CD-Audio is broadly seen as a success-story. For good reasons. The CD-Audio is a worldwide recognized standard; the underlying Red Book (1 982) its carefully and well protected by Philips and Sony. The industrial involvement of third parties is promoted by a non-discriminatory licensee policy. All this has led to an annual market volume of more than three billion discs involving a family of CD type application standards: CD-Audio, CD-ROM, CD-i, CD-R and CD-E. All these applications are based on the mechanical, opto-electronical, disc-layout and data encoding specifications described in the Red Book of 1 980. Since then a variety of technological improvements were developed leading to proposals for a new "Red Book". These trials were unsuccessful (for good reasons) until a broad consortium of companies went for a massive support towards the Digital Video Disc, DVD, standard. The DVD standard presents a challenging update of the Red Book for its technology as well as for its applications. Referring to the large variety of publications and press releases, the DVD product is certainly the most widely supported and most optimistically forecasted medium since the introduction of the CD. It happens that the optical industry has quite some experience with optimistically forecasts. These overestimations were partially attributable to inappropriate product positioning, to inadequate market volume assumptions and due to wrong assumptions on the time it would take to commercialize a new product. In looking back to this past and learning form the history of magnetic recording as well, we have to recognize that a variety of factors co-determine the success or failure in the market place. The purpose of this contribution is to evaluate the position of DVD. After summarizing the functionalities of the DVD standard, the growth factors will be summarized by evaluating the initial growth of the CD-Audio, the CD-ROM and the CD-R markets. Based on these experiences the prospects of the DVD will be discussed in terms of their most potential applications and their most relevant factors for their market growth.
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