Smarthouse has posted an article regarding an unconfirmed new version of the Xbox 360 videogame console with onboard HD DVD.

They state that "insiders" at Toshiba have revealed that Microsoft is developing a new Xbox 360 with an internal HD DVD drive. Also rumoured for the new hardware, extensive wireless capabilites, HDMI, and 1080p playback. In addition their source claims that a dual HDTV tuner and an iPod/mp3 player docking port are possibilities. With these features one might speculate that Microsoft would be adding some additional media center capabilities to the dashboard, and marketing the new unit as a media hub that bridges your home network and home theater together. They quote a "senior Toshiba executive in Singapore" as saying "An Xbox with a built in HD DVD drive is critical. They and we are working on it. It also has to be more than a gaming machine. Microsoft recognise this. A version of the device may also be sold under the Toshiba brand name". If this new hardware does make it past development, it's anyone's guess whether Microsoft will reveal the new unit at this spring's E3, or whether they would choose to wait for a consumer electronics expo, in which case CES 2009 would be the obvious pick.

The Xbox 360 already has the capability to stream music and images from your home computer. The new capabilities would have to be more ambitious than just an additional dashboard "blade", and would hopefully enable the ability for users to play alternative video formats, namely divx and xvid.

EngadgetHD got their hands on a leaked scan of Sunday's Best Buy circular, which reveals a Best Buy promotion giving Xbox 360 HD DVD add-on buyers a free Heroes HD DVD box set.

If genuine, this offer gives buyers of the Xbox 360 HD DVD add-on the free copy King Kong packed in the box, the five free HD DVDs from the Toshiba rebate, and the free $99 Heroes HD DVD box set. At Best Buy's price of $179 for the add-on, the $280 worth of free HD DVDs more than pay for the hardware purchase.

It's a very good deal, and if you own an Xbox 360 and have been on the fence about HD DVD, you owe it to yourself to check the Best Buy ad in your Sunday newspaper.

According to this article, a sub-$200 HD DVD player from a major consumer electronics manufacturer may be just around the corner.

Toshiba hasn't made an announcement yet, but recent posts on AVS Forum by a forum member who works for Wal-Mart state that a new SKU has appeared in the Wal-Mart system for a Toshiba HDA2-W, priced at $198. It is likely that Toshiba has offered incentives to certain retailers in the past, as their second generation hardware sold for well below MSRP at certain outlets. This would mark the first time that a Toshiba branded HD DVD player sold for under $200 MSRP.

Toshiba was quick to attack pricing on their hardware, and when HD DVD was at it's weakest point, price was likely the only thing selling players. HD DVD has strengthened it's position in the last couple of months, and a $198 stand alone player from a quality manufacturer is a notable milestone.

In Format War 101 we ran down what Blu Ray and HD DVD do and elaborated on the features.

Format War 201 focused on the history of the two formats, and exclusive relationships the two sides have forged with content providers and retailers.

Now it's time for the third and final semester of this elective course, and I'm going to tell you what I really think about the whole thing. First, I just want to say that movies taken from good transfers that receive quality encoding treatment on both Blu Ray and HD DVD look fantastic. As a film lover, I couldn't be happier. I definitely find myself buying titles that would otherwise be rentals for me, because I am so impressed with the video and audio fidelity the two formats are capable of providing.

Beyond whatever reason you favor one format or the other, I hope we all agree that it's the movies that really count here.