Microsoft dismisses Blu-ray as "historic phenomenon"

The console war intensified this week, with senior Xbox exec boss Chris Lewis branding disc formats a thing of the past as Microsoft slashed the price of 360 in Europe — with the entry level model now half the price of Sony's Blu-ray supporting PlayStation 3.

With the entertainment format stand-off ostensibly ending last month - when Toshiba, creator of the Microsoft-backed HD DVD, pulled out of the market - analysts are predicting a significant boost to PlayStation 3 in its wake.

As speculation continues on whether Microsoft will now move to support Blu-ray as the industry standard, however, Europe boss Chris Lewis has re-emphasised the US giant's commitment to digital downloads, dismissing the significance of Sony's format victory.

"Going forwards, digital downloads is really where it's at," Lewis told GamesIndustry.biz. "More and more people's ongoing and ever-increasing downloading of music and movies is becoming the de facto. I think that's going to happen in very short order; people want to consume that way. Before very long we will look back wistfully at shiny discs as something that was somewhat a historic phenomenon in a way that we kind of think about vinyl or VCRs today."

While Microsoft's belief in the long term potential of downloadable content over physical storage media is well documented, Lewis claimed that, despite Blu-ray's victory, the shift away from discs will happen "sooner than any of us think".

"That's the future direction, and I think that's going to be the case in the next 12-18 months," he predicted. "I think we're going to be talking much more about that than anything else. Do I think that this Christmas will somehow be defined by DVD playback? I genuinely don't think that will be the case. I do not think that [the demise of HD DVD] will have any material impact on our console velocity. And I think other factors, specifically our architecture around downloads, is far more advantageous and important for the future."

He added: "We are best placed to offer that, we already offer that, our online pedigree is such that we will offer the best and most seamless experience."

Lewis's comments follow remarks made earlier this week by Xbox 360 product manager Aaron Greenberg, who said in repsonse to speculation: "Xbox is not currently in talks with Sony or the Blu-ray Association to integrate Blu-ray into the Xbox experience. We're the only console offering digital distribution of entertainment content."

Microsoft chief executive Steve Ballmer had previously suggested that the firm was considering supporting Blu-ray with its Windows platform.

Microsoft this week cut the price of all three of its 360 SKUs in Europe, with the Arcade pack now retailing for GBP 159 and Premium for GBP 199, with Elite at GBP 259. Xbox 360 currently offers downloadable HD movies for rental via its Video Marketplace Store.

Following Toshiba's withdrawal from the market last month, SCEA president Jack Tretton said: "The emergence of Blu-ray as the de facto high-def standard is one more reason why PS3 is a great value to consumers. The combination of strong sales, Blu-ray dominance and widely-anticipated games all point to 2008 as a breakthrough year for PS3."

The first part of the GamesIndustry.biz interview with Chris Lewis can be read here, with part two to follow next week.