VLC 1.1 beta adds hardware acceleration -- better HD playback on the way
Developers are hard at work bolting on GPU acceleration to the app, and the results look good so far. Forum user riderx's CPU utilization dropped by about half when watching the Iron Man 2 trailer in HD. As Martin points out over at gHacks, hardware acceleration is only available to Windows testers.
Right now, VLC 1.1 is beta software and errors are to be expected. Some users in the VLC forums are reporting choppiness during HD playback which goes away once GPU acceleration is disabled. Once 1.1 is finalized, though, video ought to be silky-smooth.
Want an early look at VLC 1.1? Download the pre-release and share your thoughts in the comments!