It could happen. Microsoft has submitted its video compression technology to the Society of Motion Picture Television Engineers (SMPTE) for consideration as a standard. If adopted, it could spur more third-party vendors to implement the technology in such things as DVD players and camcorders. The standard would not be free - those using it would have to pay a licensing fee to Redmond - but then again, MPEG is not without fees either. Windows Media is already making in roads with the portable audio device market, video is the next obvious step.
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