Xbox 360 will not include an internal HD-DVD drive as rumors spread recently after Mark Whittard, general manager of Toshiba’s Information Systems Division in Australia declared in an interview for IT Wire.

Microsoft has previously indicated that it plans to offer the HD-DVD – a rival to Sony’s Blu-ray technology, which will ship as part of PlayStation 3 – as an add-on peripheral this Christmas.

Recent news that Microsoft and Toshiba will collaborate in offering a XBox 360 with an internal HD-DVD drive, were shoot down by Microsoft through Cesar Menendez, one of the contributors to official Microsoft blog Gamerscoreblog and Microsoft’s online community manager.

“We have no plans to release an Xbox 360 with an internal HD DVD”, wrote Menendez on Gamerscoreblog. He also wrote that “We’ve always had a games-first emphasis with the Xbox, but some consumers can build on the platform – like by adding a Windows Media Center Edition PC. By keeping the drive external, we’re offering consumers a choice in creating their own hi-def experiences. So: no plans for an internal HD DVD.”

With no price drop and no internal HD-DVD drive for Xbox, the outcome of the console battle between Microsoft and Sony remains uncertain. Microsoft certainly know their business, but it’s still to be seen if their marketing policy pays off.