Microsoft: 360 HD-DVD drive will be cheapest

While most hardcore gamers believe it's the games that will win the next-gen console war, others believe it will come down to something entirely different--movie playback. Sony has been banking on the PlayStation 3's integrated Blu-ray drive to move its console, and Microsoft has countered with an external HD-DVD drive, set to go on sale later this year.

The high-end models of the PlayStation 3 and Xbox 360 are $599 and $399, respectively, but the PS3's price includes the system's Blu-ray drive. Microsoft still has not yet announced a price for the external HD-DVD drive, and its cost could sway the next-gen race.

On the most recent episode of the podcast from Major Nelson, aka Larry Hryb aka Microsoft's director of programming for Xbox Live, Hryb had a few members of the HD-DVD team on his show for an interview. Though they didn't reveal an actual monetary figure for the drive, they did drop a few hints.

Albert Penello, Microsoft's director of global marketing, had this to say about the drive's price. "Here's the truth, we're still thinking about it. Here's what I can tell you for sure, it's going to be the cheapest HD-DVD player you can buy...without a doubt, when it comes out," he said. "Everybody is very enthusiastic with the direction we're going. There's still a few surprises left. I don't want to spill the beans yet, but I think people are going to think it's a great value."

Currently, only a few HD-DVD players are on the market, and they bottom out at just over $420. However, the Xbox 360 external HD-DVD drive won't require all the hardware of a stand-alone HD-DVD player (that will be provided by the Xbox 360), which should cut into its cost.

Penello went on to discuss Microsoft's strategy with movie playback on its next-gen console. "Xbox has always been about choice. It's always been about 'How do you want to game? How do you want to get online? How do you want to communicate with people?' What I'm excited about is that now we're going to say, 'How do you want to pick your next-generation DVD format?' We're not forcing consumers to buy something that may be obsolete, or forcing them to spend a lot of money on something they don't want." He added, "We're not betting our whole console on an unproven media format."