I right clicked in windows explorer on a file that said it was an AVI & told it to open with Vegas. Nothing happened so I opened Vegas navigated to the file clicked it in Vegas Explorer & once it was displayed there tried to drag it up to the timeline but all I got was the hourglass. I noticed down near the explorer box that it said the AVI file type was created with a DIVX codec & I suspect that this might be the proble. If this is apt to be the problem how do I fix the problem if indeed Vegas handles DIVX. I might mention that I have played back DIVX files on this PC so a codec must be installed. I don't know if Vegas is supposed to be able to handle DIVX but I had supposed that if it couldn't edit I probably should have been able to at least play it.