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Friday, March 7, 2008

Sony seeks Microsoft for Blu-ray Xbox

Following its brief campaign to support the doomed HD DVD format, Microsoft has now apparently entered into talks with Sony to bring Blu-ray disc technology to the Xbox 360. That once-unthinkable scenario was outlined today in a report in the British economic daily the Financial Times, two months after Xbox group marketing manager Albert Penello reopened the door to the possibility.

"It should be consumer choice; and if that's the way they vote, that's something we'll have to consider," Penello told the Reuters news service during the 2008 Consumer Electronics Show in January. Since then, though, decisions by retail giants Wal-Mart and Best Buy as well as online rental house Netflix made up the public's mind for it, causing Toshiba to finally abandon HD DVD production last month.

Citing an unnamed "senior executive," the Financial Times said that Sony and Microsoft are not simply discussing a successor to the Xbox 360's now discontinued, dirt-cheap external HD DVD drive. The newspaper said that there is also the possibility of an internal Blu-ray drive being incorporated into a new, more expensive "premium" 360 model, as it is already in the PlayStation 3. Thusly, Sony would earn royalties from sales of a rival console--a first for the game industry.

For its part, Microsoft quickly denied any move toward Blu-ray had been officially made. "We have made no such announcement," a rep told GameSpot. "Games are what are driving consumers to purchase game consoles, and we remain focused on providing the largest library of blockbuster games available."

For its part, Sony welcomes the possibility of a Blu-ray-equipped Xbox 360. "If Microsoft wants to release Gears of War 3 on a Blu-ray Disc, I think we can make that happen," Sony Computer Entertainment America's vice president of product marketing Scott A. Steinberg told GameSpot prior to today's report.

The top discussion of the day, brought to us by the inquisitive lads at the Financial Times of London, says that Sony has been in heavy talks with Microsoft to bring the Blu-ray player device to the Xbox 360. [Update: The main rumor has now been confirmed by Sony U.S. President Stanley Glasgow. Check it out here.]

The rumor has expanded throughout the Internet, with some groups believing that once Warner Brothers dropped the hammer at CES 2008 and chose the Blu-ray consortium, the Redmond group all but cast off the HD DVD format immediately, despite their public support for more than a month. In the ensuing weeks, with more and more studios and retailers going Blu, and Toshiba finally deciding to drop their High-Def baby, the talks between Sony and MS have gotten way more intense.

There are a few possible results here and like everything else, they all have to do with money. Consumers could easily switch up to a Blu-ray player, but only if there's a significant savings difference between the Blu-ray XBox player and the other separate Blu-ray players out there. And Blu-ray players are expensive. Remember that at one point, the XBox HD DVD was one of the best HD DVD player deals out there, just like the Blu-ray PS3 was finally thought to be a good buy when it went down to a reasonable price.

Second, Microsoft doesn't want to increase the price of any part of their system at a time when the spectre of a recession could increase profits for cheap gaming systems (it's a good entertainment value), and yet, The Big R might still might force people to only buy a few select games. In any case, they'd rather be close to the Wii's champion price point, and the lack of a top of the line High-Def certainly isn't hurting their bottom line.

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