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Dodece said:

Sony has projected the lifespan of the BluRay to be ten years. The DVD did a little better, but media format development has increased in the last decade. With many companies vying to produce the next disc format, and frankly probably the last disc format. Once you get into terabytes of storage there just isn't going to be a demand for anything bigger. That is more then sufficient to store entire movie, game, and music libraries onto a single disc.

Right now we are coming into the territory of holographic media. Which should be fully backward compatible with all of the previous formats. Given that Microsoft has spurned BluRay it is probably likely that they are already involved in one or more joint ventures to implement one of these formats. Probably with General Electric which intends to release their new format in 2013. Microsoft probably intends to jump the current format generation entirely. Which would allow them to have a very obvious hardware advantage, and to seriously pressure the BluRay format.

Microsoft seems rather earnest in not supporting BluRay, and has actively searched for alternatives. Supporting a newer format seems to serve their interests. Not only that, but full backward compatibility would mean that they wouldn't have to make a actual choice. It is easier to support a legacy, because it isn't a validation. Supporting old or outdated formats is to be expected.

So yeah the NextBox will probably play BluRay movies, but it probably will not be using a BluRay drive, and there is just no reason to expect that such a drive would become obsolete for decades. Well until something supercedes television as the conveyance.

There is going to be several things going against HVDs, though.  One, because of the tech it uses, the laser is incompatible with older disc formats.  This means that any player will require multiple lasers, which increases the costs.  Two, initial costs for players are estimated to be ~$15,000, with discs costing ~$120.  If MS were to use this in their next Xbox, they would be losing A LOT just to stay competively priced with the PS4.  And finally, and most importantly, there is...

Blu-ray.  Sony's estimate of the 10 years was the MINIMUM life expectancy for Blu-ray.  People have just started to get in on the HD "craze."  By mid-2010, 65% of US homes had at least 1 HDTV and I'm sure that number is at least 70-75% by now.  Blu-ray sales continue to increase, while not yet claiming 50% of physical movie sales.  This is partly due to Blu-ray being BC with DVD.  But as prices continue to drop, people will want to have something that takes advantage of those HDTVs.  So by 2013, Blu-ray will be getting closer and closer to passing DVD in marketshare, if it hasn't already by then.  Point being, people won't see HVDs as neccessary or be willing to switch so quickly when they have just started to buy into Blu-ray.  Not many companies will be willing to support it in 2013, either.  These above reasons are why many companies, including Sony, aren't even thinking of bringing out a HVD player until 2019/2020.

@ OP

The only real option MS has is to buy into Blu-ray.  Yes they will have to pay to license the tech, thus giving Sony and others a small income from them, but it will be much cheaper than creating their own format and setting up factories to produce those discs.  Plus, if they are going to try and be a media center (and let's face it, only Nintendo gets away with not being one) then they will have to have the lastest tech for HD movies, or otherwise seem behind the times.  I'm guessing not giving Sony, one of their main competitors in the video game field, any money, regardless of how small it would end up being, is the reason they have always opted out of the BDA up to this point.