From a Gizmodo interview with Microsoft CEO Steve Ballmer:
GIZ: When I asked Ballmer about adding Blu-ray to the Xbox, he said:
SB: “Well I don’t know if we need to put Blu-ray in there—you’ll be able to get Blu-ray drives as accessories.”
GIZ: Though he says it with certitude, the timing of any kind of Blu-ray accessory is unclear. Could he have mispoken? Certainly. However, when I asked Xbox spokespeople about Ballmer’s revelation, they responded:
MS: “Our immediate solution for Blu-ray-quality video on an Xbox 360 is coming this fall with Zune Video and 1080p instant-on HD streaming. As far as our future plans are concerned, we’re not ready to comment.”
GIZ: Microsoft PR is good — we trust them to say no if they’re not making one, and in this case, the best strategy is a “no comment”. Which turns out to be a comment.
Major Nelson says Ballmer “misspoke”, but did he really? Microsoft has been known to bring supplemental add-ons to market, so don’t nix this one yet.