The DVD Forum's Steering Committee has given preliminary approval to place Microsoft's video compression technology on the next generation of DVDs, the HD-DVD. The two other video compression technologies that were approved were H.264 and MPEG-2.
Richard Doherty, the president of Envisioneering Group, says "ends months of speculation over whether Microsoft would be endorsed or not. It's a good tailwind for Microsoft." VC-9 is what Windows Media Video 9 uses as its decoding technology.
Micorosft hopes that VC-9 will be the standard to replace the compression standard of MPEG-2 which is utilized on DVDs, cable, satellite, professional video-editing equipment, and other consumer electronics. Source