Something we love about Windows 7 is that it has much better native codec support, like H.264 and AAC. But the price might be high: It looks like Windows 7 might block third-party video decoders.
(Before we jump in, here’s our ultimate codec primer, if all this “code” talk is confusing.) Here’s how a directshow developer lays it out: MPEG-4 and H.264 codecs are hard baked into Media Foundation, and you can’t override them, since Microsoft’s list of preferred codecs in the registry can’t be edited, even in admin mode. Which means basically that Microsoft has “blocked the possibility to use alternate codecs in their applications,” according to the developer, so you couldn’t use them in Windows Media Player or Windows Media Center.
The flip side is that we are talking about a beta (the 7057 build, in between the public beta and the upcoming release candidate), not a final release, so maybe this won’t apply in the final version of Windows if developers bitch loud enough. Also, third-party applications should be able to find a workaround, postulates DigitalWerks, so VLC should be okay. Oh, and with so much codec support built in, it’s likely the average person won’t need third-party codecs anyway.