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Microsoft to launch virtual DVD service in U.K.

Software maker is partnering with U.K. retail giant Tesco to offer downloadable digital movies with features equivalent those in physical DVDs.

Microsoft is bringing the DVD experience to downloadable movies--at least in the U.K.

Teaming up with U.K. retail giant Tesco, Microsoft announced Wednesday a new service to offer consumers downloadable videos with the same interactivity, special features, and high quality found on physical DVDs.

Based on Microsoft's Silverlight technology, the "virtual DVD" service will start sometime this fall. It will allow Tesco customers who buy certain movies to also download digital copies of the flicks for their Windows or Mac computers. Besides providing high-quality video, the digital versions will include bonus content, related MP3 files and ringtones, and networked games. Tesco said it is working with "broad range of major movie studios" as part of the deal.

"For the first time, consumers will be able to enjoy a DVD equivalent experience with digital movies, which paves the way for more advanced viewing experiences enabled through Silverlight, Rob Salter, category director for Entertainment at Tesco, said in a statement. "In the future we expect to offer our customers innovative digital solutions that far exceed the DVD experience and deliver exclusive content, Web events, and services wherever and whenever they want them."

Tesco, a grocery chain, has taken advantage of technology to create new business ventures. The company has expanded its reach in recent years to create software and offer a Skype-like VoIP service.

Though the virtual DVD service initially will be available only in the U.K., Microsoft said it expects to branch out to additional markets.