Digital Foundry writes:
"The idea here is that 'Smooth Streaming' allows for an instant start to watching your video with no perceivable buffering, with the picture quality dynamically changing according to the bandwidth conditions. Should you have access to a sustained five megabits of bandwidth between you and the server, Microsoft promises a full 1080p video stream with 5.1 surround sound. If those conditions change for the worse, the stream dynamically switches to a lower quality, lower bandwidth version without skipping a beat.
Initial reports from the E3 conference suggested that this technology would be a US only affair for users of the NetFlix video streaming service, but PR blurb from Microsoft this morning suggests that Smooth Streaming is set to be rolled out on the new, improved Zune video service that sees the Xbox Live video marketplace expand from coverage in eight territories to eighteen.
So, just how good is it? Will it stand up to real life internet conditions? Is it all just PR hype or has Microsoft actually delivered something here?"