(FORTUNE Magazine) – If you like to watch movies at home, forget your VCR. In fact, clear out some room next to it, buy a DVD player, and pop a disk in the drive. You'll be amazed by the performance.

DVD, which stands for digital versatile disk, may revolutionize at-home movies, just as the compact disk changed the way we listen to music. A DVD is a compact disk on steroids. It stores up to 4.7 gigabytes of data on each side, about seven times as much information as a standard CD and enough for 133 minutes of incredibly high-quality video. DVDs have twice the resolution of videotape, which means a clearer, sharper picture and vastly superior audio. Unlike magnetic tapes, which get fuzzier each time they're played, a DVD will give the same picture and sound to the 100th rental customer as to the first.

DVDs can store multiple soundtracks and subtitles and offer some incredibly cool features, available from a menu activated by your remote control. You can skip instantly from one scene to another, so filmmakers will be able to provide interactive movies. An early example was last year's rerelease of The Little Shop of Horrors, which gave viewers a choice of endings--the upbeat version that made it to theaters or the original, darker denouement in which man-eating plants devour New York. Oh yes, DVD players can handle standard music CDs, and you'll soon find interactive videogames designed specifically for DVD players.

There are still a couple of downsides to DVD. Thanks to industry squabbling, you can't record onto a DVD. I also found that some DVDs don't handle an important technical detail called "aspect ratio." Since movie screens are proportionately wider and shorter than TVs, most films shown on TV have the outer portions of the picture edited out. But many purists prefer the "letterbox" format, which shows the movie in its original form with dark bands at the top and bottom of the screen. Some DVDs don't give you a choice of formats. Before you rent one, check the label to ensure you're getting the format you like.

I tried out the new technology with a Pioneer DV-414, a low-end model that sells for $300 to $400 but does its job remarkably well. To make it work you'll need a TV with composite video and audio inputs (don't worry--I found them on the back of my nine-year-old Magnavox). If you have a more sophisticated TV set or home theater, the DV-414 has component video, S-video, and digital outputs jacks--fancy hookups that deliver an even grander picture.

Once I figured out the hookup, I put in Midnight in the Garden of Good and Evil and stared in amazement at a picture far sharper and more three-dimensional than anything I'd ever seen on the old TV set. When I tried a couple of action flicks--U.S. Marshals and Armageddon--the sound pounding from those TV speakers was nothing short of astonishing.

The only problem I had was Pioneer's remote control from hell. With 42 buttons crammed into a two- by five-inch surface, it's poorly organized, with labels that are impossible to read, even with bifocals. On the bright side, while poking at the remote I inadvertently discovered many extras that DVDs provide. Consider the Midnight disk, which hosted a delightfully eccentric film based on a true-life murder mystery in Savannah. The DVD version included an interactive tour of Savannah and interviews with the people whose lives were portrayed in the movie.

While most distributors are releasing DVD versions of their films at chains such as Blockbuster and Hollywood Video, you may have trouble finding DVDs in smaller stores. They're worth looking for. And if you aren't sure you want to invest sight unseen, many DVD outlets will rent a player for a couple of dollars a night. But after testing this machine, I'm convinced: the time has come to invest in a DVD player.

For information on the Pioneer DV-414, call 800-421-1606 or surf to www.pioneerelectronics.com. For general in formation on DVDs, check out the industry's home page at www.dvdvideogroup.com.

--Michael J. Himowitz