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Hopes for native Blu-ray support in Microsoft's upcoming Windows 7 operating system have been dashed with confirmation the new OS won't play Blu-ray movies out of the box.
Blu-ray support in Windows 7 will be provided by "PC makers or BRD drive makers," according to Steven Sinofsky, senior vice president of the Windows and Windows Live Engineering Group at Microsoft, in a statement published by windows7center.com.

"We have new extensibility in media center for those that provide BRD playback to support integrated playback. We do have support for burning BRD data discs," Sinofsky said in an email.

Just as with Windows XP and DVDs, Blu-ray playback under Windows 7 will require the installation of third party media suites such as CyberLink's PowerDVD or Corel's WinDVD (Corel acquired InterVideo in 2006). By refusing to licence the Blu-ray playback decoder for Windows 7, Microsoft is pushing the costs onto PC makers who will generally obtaining Blu-ray licenses bundled with Blu-ray drives.

Microsoft backed the doomed HD DVD format in the high definition format war which saw the Sony-backed Blu-ray format emerge victorious. Redmond has not completely turned its back on the format, with Windows 7 offers the ability to read and burn Blu-ray data discs.

The news comes as the entertainment industry works to simplify Blu-ray licensing. Blu-ray royalty rates are expected to plunge with the formation of a global independent Blu-ray licensing company by industry heavyweights Sony, Panasonic and Philips.

A new license system will be established by mid-2009 as a "one-stop shop" for device makers, representing the interests of all Blu-ray patent holders. Licensing will be managed by an as yet unnamed new company, headed by Gerald Rosenthal - former head of intellectual property at IBM. Offices will be spread across the United States, Asia, Europe and Latin America.

As a result of the new licensing systems, royalty rates will drop by 40 percent for individual Blu-ray Disc, DVD and CD format licenses.

The fees for the new licenses will be US$9.50 for a Blu-ray player and US$14 for a Blu-ray recorder. Making Blu-ray Disc will cost 11 US cents for read-only, 12 US cents for recordable discs and 15 US cents for rewritable discs.

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