Microsoft finally pulls plug on HD DVD

Microsoft said it will stop making HD DVD players for its Xbox 360 video-game system after Toshiba ceded the high-definition video format battle to Sony's Blu-ray.

Microsoft said Saturday it would continue to provide standard warranty support for its HD DVD players.

A spokeswoman told Bloomberg News the company also will cut the price of players remaining in stock by more than half, to $49.

Toshiba President Atsutoshi Nishida last week estimated about 300,000 people own the Microsoft player, sold as a separate add-on for the Xbox 360.

"HD DVD is one of the several ways we offer a high-definition experience to consumers, and we will continue to give consumers the choice to enjoy digital distribution of high definition movies and TV shows directly to their living room, along with playback of the DVD movies they already own," Blair Westlake, a corporate vice president of Microsoft's media and entertainment group, said in a written statement.

Microsoft was one of HD DVD's main backers, along with Intel and Japanese electronics maker NEC. Its support was seen as a big win for Toshiba's format.

But support for the HD DVD waned as big movie studios — Sony Pictures, Walt Disney Co., 20th Century Fox and Warner Bros. Entertainment — picked Blu-ray to distribute high-def DVDs.

Wal-Mart Stores struck what seemed to be the final blow just over a week ago when it said it would sell only Blu-ray players and discs.

The rival formats deliver crisp high-definition pictures and sound, but they are incompatible with each other, and neither plays on older DVD players.

Microsoft said it is looking at how the HD DVD technology it has developed, such as HDi, which adds interactive features to HD DVDs, and its VC-1 video encoding technology, can be applied to other platforms.

The company said the decision to stop selling HD DVD players won't have a material impact on its video-game business.