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The main motive of the Chinese standard CH-DVD is to avoid having to make royalty and copyright payments to foreign companies. Why should they make such payments? It totally makes sense, this makes much much cheaper for China and more expensive for rest of the world to invade the Chinese market. Why should they pay the H.264 patents and royalty? Companies such as Phillips has been suing Chinese chip/system makers for MPEG2 royalty. That is why the Chinese develops the AVS standard. When the satellite carrying AVS format to broadcast the Olympic Game in summer 2008, everyone need to support the CH-DVD. The availabilities of the contents in AVS and CH-DVD format are very important to promote the standard.
 

CH-DVD

CH-DVD (China High Definition DVD) is a high definition DVD format announced in September 2007 by the Optical Memory National Engineering Research Center (OMNERC) of Tsinghua University in China. Its format is compatible with those of HD-DVD and can be played in a HD-DVD player and vice versa. Its developer claim the format contains more copy protection features and is part of a big push by China to fight piracy.

So far, not many companies are really making chips and systems with the Chinese standards. There are two reasons:

1. Chinese companies want to export their cheap products. There is no demand for the Chinese standard outside China.

2. There is no contents in the Chinese standard format.

Most western set top box companies are just in "wait and see" stage. Celestial Semi made a chip a year ago. Some system companies are considering using the domestic chip to integrate the HDTV set-top box. The Chinese government needs to pour more money to support this standard.

AVS

Audio Video Standard, or AVS, is a compression codec for digital audio and video, and a possible alternative to H.264/AAC/Vorbis, meant to potentially replace MPEG-2. Chinese companies own 90% of AVS patents.  The audio and video files have an .avs extension as a container format, and the designers claim that it will have twice the efficiency of MPEG2. Though the picture may not be as optimal as the H.264.  So the war is going one for sometime. Is it H. 264 or AVS?

Overview
Development of AVS was initiated by the government of the People's Republic of China. Commercial success of the AVS standard would not only reduce China's royalty/licensing payments to foreign companies, it would presumably earn China's electronics industry recognition among the more established industries of the developed world, where China is still seen as an outlet for mass production with limited indigenous design capability.

So far, not many companies are really making chips and systems. Most western set top box companies are just in "wait and see" stage. Celestial Semi made a chip a year ago. Some system companies are considering using the domestic chip to integrate the HDTV set-top box. The Chinese government needs to pour more money to support this standard.  AVS
 

BEIJING--(BUSINESS WIRE)--The Optical Memory National Engineering Research Center (OMNERC), a laboratory dedicated to optical disc research in Tsinghua University, today announced CH-DVD (China High Definition DVD)(a), a new generation high definition DVD format developed in collaboration with research institutes and manufacturing enterprises at home and abroad. The physical format of CH-DVD includes Chinese-owned intellectual property, and is based on HD DVD, the next generation high definition DVD approved by the DVD Forum. The realization of CH-DVD was supported by the Chinese government, and will pave the way for the localization of blue-laser, high-definition DVD in China.

On Sept. 7, 2007, OMNERC established CHDA -- the China High Definition DVD Industry Association -- in cooperation with the DVD Forum and Chinese and international partners. CHDA will play a leadership role in the promotion of CH-DVD, and will make a big push to launch CH-DVD player into the Chinese market in 2008.

The emergence of CH-DVD as a high definition format integrating Chinese-owned intellectual property clearly demonstrates that a Chinese optical disc technology is already at the world-class level. In the near future, all related industries in China are expected to make the transition from standard definition DVD to high definition DVD.

CH-DVD is designed to play a central role in the sound development of the content industry, and adopts advanced copy protection technology that effectively prevents the spread of pirated copy. Many content holders have confirmed their support for CH-DVD and will launch movie titles in the CH-DVD format.

In the next year, China will start broadcasts of high definition TV programs. In combination with HDTV, CH-DVD will provide a wide variety of HD content that will enrich the lives of viewers.

The news in chinese is here  original news

CVD

The China Video Disc (or CVD) standard is a CD-based MPEG-2 audio and video format developed in 1997, intended as a successor to Video CD and an alternative to DVD-Video. It is almost identical to the SVCD standard, the only technical difference being a lower video resolution. Articles for CVD  CVD   

EVD

The Enhanced Versatile Disc (EVD) is an optical medium-based digital audio/video format, developed to provide a means for playing HDTV content using existing optical media. It was announced on November 18, 2003 by China's Xinhua News Agency as a response to the popular DVD-Video format and its licensing costs (which some considered excessive). It uses an optical storage medium in CD size (120 mm) that is physically a DVD disc with the same UDF file system. China started development on EVD in 1999, because DVD Video (CSS, Macrovision, etc.) and MPEG-2 (Video and Systems) licensing costs were relatively high — reportedly in the range of $13–$20 USD per hardware video player. EVD  EVD .

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