engadget.com - not have a clue...
http://www.engadget.com/entry/1234000293070178/

It's no big deal that one movie studio is choosing not to use a standard, proven, hi def-centric codec, but how poorly does it reflect specifically on Sony that their SVP of advanced tech doesn’t get it that H.264 offers the same image quality as MPEG-2, but at lower bitrates, or offers a high def picture at the same bitrates as the old standard?

Not only is this post filled with emotion, it's not even technically accurate. The MPEG-2 format is not a codec. It is a specification for a bitstream which allows for an extremely wide latitude of encoder design and implementation. And all encoders are not created equal.

CO - encoder DEC = decoder and never the twane shall meet. They are, in fact, almost completely independent of each other.

This post also mentions that H.264 can do Hi-Def at DVD MPEG-2 bitrates. Well, MegaPEG can do 1280x720p MPEG-1 VBR at
DVD MPEG-2 bitrates. Which is to say, 24fps with 4-7 average bitrate.