Although we have multiple sources in Asia who tell us that Microsoft has explored the possibility of either doing a Blu-ray add-on drive for the Xbox 360 or offering a new version of the console that includes a Blu-ray drive, once again at CES Robbie Bach, who heads Microsoft Entertainment Devices division, claims that it is not going to happen.

Reports suggest that Bach simply believes that the decision not to offer Blu-ray on the Xbox 360 boils down to the fact that Xbox 360 owners are not asking for it; it does not help Microsoft with the core of what the Xbox 360 platform does, which is gaming. It also costs a lot of money and does not really add any value for software developers, since they would not be distributing games on Blu-ray (as that would leave many of the 28 million Xbox 360 consoles that have been sold out in the cold).

Money could be the biggest deciding factor, as Microsoft has wanted to continue to drive the price of the Xbox 360 down to help it make its way to more consumers. Many believe that the magical $200 price point has more to do with the recent increase in sales of the Xbox 360 than anything else. Microsoft might also think that for the time being the so-called advantage of the PlayStation 3 having a Blu-ray drive isn’t that much of an advantage currently, as sales for the PS3 have not been stellar.

Bach’s statements did not close the door all the way on the possibility, but at least for now we have to agree that it is unlikely that we will see Blu-ray on the Xbox 360 in the near term. Instead, we believe that Microsoft will continue to work the Netflix partnership and download video content angle, with the possible future release of a larger hard drive at some point. While all has gone quiet as to when we might see a larger hard drive for the Xbox 360, several sources are telling us that it is likely to happen in the summer time frame.

One other thing that should also be pointed out as part of this story is that Microsoft has all but admitted that for the time being they are going to continue to focus their efforts on the Xbox 360; and while they might be thinking about the development of a new console platform, at least there is no plan for the time being to replace the Xbox 360 with a new console, often rumored to be called the Xbox 720.

The news is not really surprising given the current state of the world economy. So we would consider the latest Jasper generation of the Xbox 360 to continue to be a safe purchase, which is surprising since the Xbox 360 was originally developed in 2005.