LAS VEGAS - In an interview with C|Net, Bill Gates was asked about Microsoft’s support of HD DVD and Blu-ray in light of Warner’s recent announcement supporting Blu-ray. Mr. Gates came down on the side of Internet access to media.

Asked if Warner’s move to support Blu-ray exclusively mean that HD DVD is dead and what it would mean for Microsoft, Mr. Gates said, "The last studio announcement was Paramount going exclusively to HD DVD, so there’s been some back-and-forth. It’s kind of a classic format war. You have to think of what we are doing with our HD-interactive software as being actually neutral to any of these platforms."

"The third platform, which I don’t think anybody would dispute will win in the long run," Mr. Gates continued, "is directly downloading over the Internet. That’s the way Mediaroom TV works. That’s the way Xbox Live works. We’ve got more content with Disney and MGM coming onto that. It’s been very, very successful."

Referring to music and subscription services, Mr Gates added: "Your collection, it’s up in the cloud. Any new device you get, it’s there. That will happen for video too. The actual physical format battle here isn’t really, in some sense, that important. But getting the movies so you can access it through any broadband device--that’s the future."

When asked if Microsoft would, at some point, add support for Blu-ray on the Xbox, Mr. Gates said: "Third parties can do peripherals for Xbox. Obviously, all of the different optical-drive technologies are supported in Windows. At the core, we are about software and making sure the HD activities get to critical mass."

iPO notes that having access to the Internet "cloud" is also a vision of Google CEO Eric Schmidt -- who is also on the Apple board of directors. Currently, communication speeds for mobile hand held devices like iPods and iPhones and even home computers are not sufficient to make the Internet "cloud of data" accessible instantly for HDTV. In time, that will certainly change. What’s notable, however, is that Microsoft has eased away from a vocal support of HD DVD given recent events and come around to the "data cloud" approach -- a very practical thing to do considering the possible imminent demise of HD DVD.