by: Marcus Yam
The Xbox 360 Elite is the top SKU... for now
Microsoft to put Blu-ray Disc inside Xbox 360 to compete with PlayStation 3

Although Microsoft has continually denied the development of a Blu-ray Disc enabled Xbox 360, reports slowly trickle in from Asian OEMs working on such an upgraded console.
According to a recent report by the DigiTimes, which cites Chinese-language Economic Daily News (EDN) newspaper, Pegatron Technology, an OEM subsidiary of Asustek Computer, has won the order to make Xbox 360 consoles equipped with a Blu-ray Disc drive.
Previous interpretations of Blu-ray Disc on Xbox 360 figured an add-on device similar to the HD DVD drive, but this latest report points strictly at a new SKU that would incorporate a BD-ROM drive internally to match up with the PlayStation 3.
Shipments of such a console are supposed to commence in the third quarter of this year, likely making it a product that Microsoft will promote heavily during the holiday season against Sony’s console.
Last month, reports from Taiwan pegged Lite-On as the maker of Blu-ray Disc hardware for the Xbox 360. Microsoft quickly turned around to deny any development of such a product, and continued to push Xbox Live Marketplace’s high-definition content. “For our customers who want a premium movie experience we offer the largest library of on-demand HD content available and the ability to play back DVDs in high definition,” said the representative.
The PlayStation 3 is the best Blu-ray Disc player on the market, which allows Sony to capture both the hardcore gaming and home theatre crowd. ABI Research estimated that PS3s make up more than 85 percent of Blu-ray players in use this year and that the number of stand-alone players and Blu-ray-equipped PCs won't surpass Sony’s console base until 2013. A Blu-ray Disc capable Xbox 360 could help Microsoft’s console look more attractive to high-definition movie buyers.