Following up on that Cannes Lions video yesterday, Mobility Digest (and 'Stepehn' in our comments, natch) noticed that when Kostas loads up that Xbox website, the site contains embedded Silverlight material--specifically an HD video.

Now, Microsoft has repeatedly stated, even as little as one month ago, that Silverlight won't be embedded in Mobile IE in WP7, at least not initially  Seems odd for them to want to hide such a feature since promoting Silverlight web development would be in their interest. However, the Mobile IE team is working quite hard and perhaps they have been ahead of schedule in building on features?

But to play devil's advocate, we never actually see any Silverlight content load or play. Then again there must be some type of Silverlight recognition going, since we don't get a grey placeholder box or something similar, like when say the iPhone/iPad can't load Flash.

Right now we'll file this under plausible. But until we hear from the Mobile IE team, Microsoft themselves or see it in action, we're going to remain a wee bit skeptical as we don't want to get anyone's hopes up.

Update: Actually, as pointed out in comments and evidenced by the picture below, Silverlight is not embedded. What you get is a notification to download Silverlight (assuming its supported), which is mentioned in the video. The static-image is automatic and nothing unique as can be seen by the screenshot from my Android HTC EVO. So yeah, nothing to see here folks :-/