The Interwebs have just been abuzz lately about the potential of an Xbox 360 equipped with Blu-ray. Some outlets even speculated that the new SKU would be released at a price point cheaper than the Xbox 360 Elite. Word was that today at 10am, Microsoft was to announce the new produce, and then we would all rise up in unison and shout "NOT NEWS!" feeling smug in our insider knowledge via blogs.

Well, 10am came and went without an announcement, and Microsoft’s own Robbie Bach, Entertainment & Devices Division President, completely quashed the idea that such a machine would ever exist. In an interview with the San Francisco Chronicle, Bach claimed that all the high-def experiences Xbox owners could need could be delivered through the Xbox Live service. He also destroyed any notion of an add-on Blu-ray player by stating that, "There’s no additional media. There is nothing you need to purchase."

Bach goes on to note that Blu-ray sales haven’t accelerated the way people expected them to after the demise of HD DVD, and that the difference between Blu-ray and progressive scan DVD is not significant enough for people to justify buying a brand new unit.

Bach also had no comment on the next generation of Xbox, stating, "That is so far out that there isn’t anything to talk about." He does expect the 360 to have a longer lifecycle than its predecessor, considering that the original Xbox debuted late in the last console cycle, while the 360 was first out of the gate this time around.

Anyone holding their breath about the idea of Blu-ray coming to the 360 can go ahead and exhale now, as it seems like Microsoft is essentially giving us a "not now, not ever" response. It’s no secret that they believe the future of interactive media lies in digital downloads rather than disc-based products anyway, so expect them to announce an all-digital format long before they ever bow at the altar of Blu-ray.