Warner Bros is offering HD-DVD buyers the chance to replace their movies with Blu-ray copies for $4.95. But the deal is plagued by restrictions which will likely mean it does little more than irritate buyers who backed the wrong horse.

The basics of the deal sound fine: you simply mail in the cover art from the disc packaging along with your payment, and Warner sends you a Blu-ray replacement. Each customers can replace up to 25 discs.

However, the deal is not only limited to Warner-produced discs, but to just 128 specific titles. And the conditions note that not only is there no guarantee you’ll get the same DVD extras (so watch out for special editions being replaced by bare-bones versions), but the disc you get might be in fullscreen rather than widescreen editions. That might not be a problem for some buyers, but the chances are that most people who’ve splashed out on both an HD television and a next-generation DVD player won’t be too happy with a 4:3 picture.

With these restrictions, the deal looks less like a generous gesture to help the casualties of a format war, and more like a chance for Warner to shift unwanted stock which had been produced on the mistaken assumption that Blu-ray buyers would pay extra for picture quality but try to save a few bucks on features.

It also doesn’t really help that Warner is marketing the scheme with the tagline “Upgrade your Warner Bros. HD-DVD titles for new industry-leading Blu-ray discs”. Leaving aside the argument about whether Blu-ray is an upgrade to HD-DVD, using that wording is likely to make HD-DVD buyers once again feel they’ve been tricked into wasting their money and that the $4.95 per disc charge is their penalty.

There is at least some good news for the next-generation DVD industry, however. Blu-ray sales for the first three months of 2009 were around 9 million units, close to double that for the same period last year. That’s likely down to a drop in Blu-ray player prices (and the resulting increase in sales as Christmas gifts), plus the confidence of buyers that the format will stick around.