Microsoft had denied it until it was blue in the face, but in the lead-up to E3 2008 this week, it was still believed from many corners of the net that the demise of HD-DVD, would lead the company into signing a deal to bring Blu-ray to Xbox 360.

It's finally time to put to that rumour to bed after a report from Forbes claiming that Shane Kim, vice president of strategy and business development for Microsoft’s Interactive Entertainment business, told them that the company's focus is digital distribution and that it has "no interest' in bringing Blu-ray functionality to the Xbox 360.

“I can categorically say that we’re not working on a Blu-ray player for Xbox 360,” says Kim. “To my knowledge, we don’t have any intent to do that.”

At E3, Microsoft announced its intention to increase its digital distribution on Xbox 360. revealing a significant partnership deal with Netflix , the US-based largest online DVD rental company in the world, which will allow US-based Xbox 360 gold subscribers to stream movies to their Xbox 360's for free.

There was also more good news for movie fans with news that NBC Universal has also struck a deal with the Big M, which will see its catalogue of content, including the hit TV show Heroes, made available for download shortly.

Source :: Forbes