"Microsoft's in-the-box VC-1 video encoder in Windows 7 doesn't utilize all cores of multicore system to achieve optimal video performance during video playback and editing. Microsoft is aware that this's a known issue for all versions of Win7 and is working on it for a future release," stated Microsoft in KB2144672.
"VC-1, a video codec specification standardized by Society of Motion Picture and Television Engineers (SMPTE) is included into Win7, and is designed to achieve state-of-the-art compressed video quality at bit rates that may range from very low to very high. The codec can easily handle 1920 pixel × 1080 pixel presentation at 6 to 30 megabits per second (Mbps) for high-definition video. VC-1 is capable of higher resolutions such as 2048 pixels × 1536 pixels for digital cinema, and of a maximum bit rate of 135 Mbps. An e.g. of very low bit rate video would be 160 pixel × 120 pixel presentation at 10 kilobits per second (Kbps) for modem applications," Microsoft stated.