What they mean is...
If HD DVD dies then you'd be stuck with a drive for a dead format. Having external means you can then release a blu-ray external drive.
Microsoft will not build an HD DVD drive into a future Xbox 360 because it doesn't want to "limit the user's experience", an insider at fellow HD DVD backer Toshiba has said. Not exactly a ringing endorsement of the next-generation optical disc format, you might think, but there you have it it: buy HD DVD, limit your …
The problem is, because the HD-DVD drive is not part of the Xbox's original spec, devs can't rely on its presence in every console, hence they can't put their games onto the format. So the HD-DVD drive could only be used for movies. In contrast, the PS3's Blu-Ray drive is present in every console and therefore games come on BD disks.
So....if the HD-DVD movie format were to fail, XBox owners with integrated HD-DVD players would indeed be left with a crippled box. Conversely, if Blu-Ray failed as a movie format, PS3 owners would still be able to utilise Blu-Ray for their games, hence no real loss.
Since the news are out that Blu-Ray is outselling HD-DVD 2:1 in the States, it would be stupid of Microsoft not to consider an eventual external BD Drive for the 360.
Regardless of the merits of the HD-DVD format, we all know (in denial or not) where the format war is heading.
Personally, I'm waiting until the second Generation of the format to go out and buy a BD-RW for storing all my photos (I'm a photographer) on a whopping 50GB disc :)
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Altrough I am more of an HD-DVD supported than BD, I must say that NOT intergrating HD-DVD in the Xbox does make sense.
Look at the PS3, last I heard they were seling 1 BD disc per 4 PS3 sold, this clearly mean that only a small percentage (probably around10%) of the gamers buying these console are interested in HD movies. Why force you customer to buy an expensive drive they probably don't want and won't use?
Also the drive would probably have to be subsided by Microsoft, meaning they would trow away money to have an installed base of players most of which will never be used to actuallywatch HD movies.
If the "bundling with console" things worked BD discs would outsel HD-DVD 10 to 1, not 2 to 1, and in the last months the gap reduced itself more to 60% - 40%, HD-DVD gaining back marked share despuite the US PS3 price drop. To me this shows that the bundling doesn't work as Sony expected.
At this stage bundling an HD drive with a console bleeds the console manufacturer in subsidies for a questionable market share benefit. I think that if sony could have known the result of bundling BD with the PS3 in advance they wouldn't have done it either.
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