The report, which examines the evolution of the high-definition market until 2011, suggests that studios supporting only a single format will be missing out on significant potential revenues in coming years by not making their product available on both Blu-ray and HD DVD.
The U.K.-based research org predicts combined consumer spending for both formats will reach $1.55 billion in 2008, up from the $438 million mark projected for this year.
Screen Digest estimates that studios supporting one format are missing out on an estimated $270 million in consumer spending next year.
"Christmas 2007 is going to be critical for the hi-def video business," says Richard Cooper, Screen Digest Video Analyst. "Both formats will be seeking to secure consumer buy-in to their proposition during the critical holiday season but with so much at stake on both sides we think it is highly unlikely that one format will emerge as the 'winner.'
"Once it becomes clear that both formats are gaining customer acceptance, studios that have chosen to support one format over the other will realize that they are missing out on potential sales and will have to decide how long they can afford to place principle over profit.
"We believe that eventually most will decide to offer their titles on both HD DVD and Blu-ray in order to maximize their returns."