Microsoft has faith in digital distribution for Xbox 360

James Delahunty
7 Apr 2008 20:09

Following the fall of the HD DVD disc format, all eyes turned to Microsoft's Xbox 360 console, expecting a response to the news that could come in the form of a Blu-ray-equipped Xbox 360 unit or optional peripheral. It wasn't long until the rumors started circulating about deals and orders from Microsoft that indicated such a move, but again, Microsoft firmly denied any plans to physically support the Blu-ray format.
Sony Corp. on the other hand embraces the inclusion of a Blu-ray drive in the PlayStation 3 (PS3) console, providing full HD video from BD media to owners, as a key advantage over the Xbox 360 console and a win-win package for consumers. Microsoft does take the need for HD-video capabilities seriously it seems, but instead of back the format of its rival (yet), the company has put its money on digital distribution.
"We have always said online is the way to go," Microsoft's Neil Thompson said, predicting that physical media would give way to downloads within the next three years. He declined to accept the view that Microsoft has abandoned owners of the HD DVD add-on drive. "We said to people they had the choice; we didn't force it on them as we didn't put it in the box," he said.
More than 300,000 HD DVD add-on drives are believed to have been sold to owners of the console, due to its relatively cheap price from release compared to the stand-alone prices throughout its short life-cycle. Thompson says however that the focus for the Xbox 360 was always on digital content, and not relying on a physical disc format.
"Our belief was that in the lifetime of the Xbox 360 we were going to move to this online world and online distribution for content outside gaming," he said. "If we didn't believe that we would have put a hi-def player in the console." He believes Microsoft is now better off putting its focus on the development of services in the digital domain, as opposed to offering a Blu-ray drive.
"More and more people are consuming more and more hi-def and standard-def content online. The expansion and growth of consumption of digital content is exponential," he commented. The Xbox Live video download service in the United Kingdom has faced criticism however from all angles due to its lack of variety. In response to the criticism, Thompson said that the company will be announcing new partners and offering more content throughout the year.


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