The founder of Blue Ray Technologies, an independent US Blu-ray factory, has hit out at the industry over the reported $150m in incentives given to Paramount and DreamWorks Animation to shun the format.

Earlier this week it emerged that Paramount is to be paid by Toshiba and the other HD-DVD proponents for producing content exclusively for the HD-DVD format.

Studios including Sony Pictures, Disney, Fox and MGM are Blu-ray only. Warner Bros remains dual format, while Universal, and now Paramount, will only release videos in HD-DVD.

"Toshiba and HD-DVD offered this deal because they are desperate. The public has chosen Blu-ray discs with their pocket books, buying them 2-to-1 over HD-DVDs this year," said Blue Ray Technologies founder Erick Hansen.

"For retailers, it's like being forced to stock VHS tapes after the public chose DVDs. For the consumer it creates more confusion that hurts the industry-wide move to high-definition."

Hanson noted that DVD retail leaders Blockbuster and Target will only stock Blu-ray on their shelves.

"What has Paramount gained by accepting the money?" asked Hansen, suggesting that if multi-billion dollar directors like Steven Spielberg and Michael Bay support Blu-ray, the deal is a double-edged sword.

Spielberg's films are specifically excluded from the Paramount-DreamWorks Animation deal and will continue to be released in both formats, according to Paramount.

Whereas Bay recently released a statement on his website publicising his displeasure at the distribution of Transformers I and II on HD-DVD only.

"It is not that I am surprised they took the deal," Hansen said. "But it is like paying them not to grow crops. How is the film industry going to segue into the next-gen world if it accepts a relative pittance to stunt its growth?"