According to Eurogamers Digital Foundry, the new Xbox 360 dash appears to playback video in limited range RGB. This causes videos to seem "washed out", with colours looking less intense and blacks transforming into greys.The screenshots to the left show the phenomenon in action, although the issue is reported to be more evident in motion.
Digital Foundry received a number of emails from unhappy Xbox 360 users which prompted it's investigation into the matter. It seems Microsoft was alerted to this problem during beta testing, but instead of fixing the issue for release, they reacted by deleting any threads referring to the problem and leaving this message:
"Thanks for the feedback! Though we will not be able to incorporate your feedback into this release we will save it for consideration in future releases. Thanks for using the new Xbox Update and please keep up the feedback!Apparently there has been no official acknowledgement on the issue from Microsoft, despite the fact that it affects all users of Xbox 360 (including those using HDMI, or Componant). It seems that Microsoft are aware of the problem due to their deletion of bug reports, but it's anyones guess whether they are working towards a fix.
Source: http://www.eurogamer.net/articles/digitalfoundry-new-dash-borks-video-playback
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