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Extracted From XBOX.com

Why HD DVD?
It's no secret that there are two next-gen DVD formats hitting the market. The first to market was HD DVD and the second (indeed already out in Japan) is Blu-ray. After two years of deliberation, Microsoft made its choice and decided to back HD DVD. The question then becomes why? Here are a few reasons:

• Manufacturing: Concerns developed regarding Blu-ray's ability to manufacturer the discs at the capacity originally intended. In fact, with the Blu-ray launch in Japan, the discs are being created at single-layer 25 Gigabyte capacity, which is half of the originally intended 50 gigabytes.

• Easy to Damage: Because Blu-ray discs are encoded near the very top layer of the disc with limited protection, the data is literally at higher risk to damage. Conversely, HD DVD maintains physical protection similar to standard DVD.

• Copy Protection: Blu-ray utilizes not one, but two different forms of copy protection, adding an extra layer of protection and complexity that just didn't appear necessary.