Toshiba is aggressively promoting its HD-A2 second generation HD DVD player through mega-retailer Wal-Mart, which has begun selling it for less than $200. "We reduced our HD DVD Toshiba player, the generation-two, to $198 earlier in the week," said Wal-Mart spokeswoman Melissa O?Brien in an interview with Fortune.

The move could shift momentum in the high-definition format war between HD DVD and Blu-ray, especially in the upcoming holiday season.

"It's happening now, and that's really all I can tell you. We don't give any information on what we're planning to do for the holidays. We know HD DVD and Blu-ray are going to be popular items this holiday season for some of our customers," Wal-Mart's spokeswoman added.

Until now, Toshiba's HD-A2 mainstream HD DVD player had been available in stores for $230-$280. On the other hand, the cheapest Blu-Ray player available now is the Sony Playstation 3 entertainment system, which sells for $400.

The HD-A2 HD DVD player supports HD DVD, DVD and CD playback and hardware decoding of H.264, VC-1 and MPEG2 video. Support for audio includes Dolby Digital, Dolby Digital Plus, Dolby TrueHD, DTS and DTS-HD formats. The player can output video in 720p (1280x720) and 1080i (1920x1080) resolutions using HDMI or component outputs and multi-channel audio using HDMI or S/PDIF connectors.

Video enthusiasts who need more than the 1080i resolution would have to pay some extra $150 for a high-end HD DVD player that can output 1080p, or go for a Blu-Ray player ($400).