Report: Microsoft offers cash incentives for HD-DVD

Microsoft is offering cash incentives called coupons to computer makers that sell personal computers with HD-DVD drives, a next-generation DVD format the software behemoth is supporting over rival Blu-ray disk, Electronic Engineering Times reported Monday.

Microsoft declined to comment in the EE Times report, which cited as evidence of Microsoft's success Hewlett-Packard's decision to back HD-DVD as well where it previously exclusively supported Blu-ray. An HP executive also said Microsoft's forthcoming Vista version of Windows will include HD-DVD support for free, whereas PC makers must pay about $30 per drive in Blu-ray royalties.

In September, Microsoft and Intel raised the profile of the battle between HD-DVD and Blu-ray when they announced they badked HD-DVD. Both drive types offer higher capacities than current DVDs, making it possible to record high-definition video, and both types of drives are expected to debut in 2006.

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