Lucky for us, the folks at Red Kawa -- makers of video conversion utilities like Videora Xbox 360, PSP Video 9, PS3 Video 9, and Wii Video 9 -- are experts in all things video conversion and they break the announcement down like this: "This puts Microsoft at the head of the pack in the Apple TV vs PS3 vs Xbox 360 video battle royale." Oh SNAP! They break down the details so we don't have to ... c'mon PS3, H.264 Main Profile only? All the kids want H.264 High Profile support nowadays!
Actually, the kids really want Xvid and DivX support so they can watch their torrents of bits, which Red Kawa reminds us this isn't. First, it doens't support the AVI container (so there!) and the 360 only supports MPEG-4 Part 2 Simple Profile while Xvid videos are encoded as MPEG-4 Part 2 Advanced Simple Profile. Any questions?