Microsoft and Toshiba announced that they will be working jointly to develop HD-DVD players that will use Microsoft Windows CE technology. Toshiba is hoping that the alliance will help bring a shorter development period and lower costs.
Sony, Microsoft’s main competitor, backs Blu-ray technology. Both have worked for three long years to have their technology become the next standard for home media. In February, the two sides called a truce and began negotiations to find a standard that would adopt both formats. The negotiations stopped with no result and both companies have seemed hesitant to resume negotiations.
When Bill Gates was asked about using HD-DVD on the Xbox 360, he replied that the console will be shipped with current DVD format, but HD-DVD may be added later.