This is a change from earlier versions of PowerPoint. In those earlier versions, when you inserted a video into a presentation, the presentation linked to the file instead of embedding the video.
Use the PowerPoint ViewerYou can play videos in a PowerPoint 2013 or 2010 presentation by using the Microsoft PowerPoint Viewer. You can download the PowerPoint Viewer by visiting the following Microsoft Download Center Page:
Update PowerPoint 2007 to the 2007 Microsoft Office suite Service Pack 2The 2007 Microsoft Office suite Service Pack 2 updates PowerPoint 2007 so that it can play embedded videos in presentations that are created by PowerPoint 2010. For more information about how to obtain the latest service pack for the 2007 Office suite, click the following article number to view the article in the Microsoft Knowledge Base:
Article ID: 982947 - Last Review: Dec 26, 2012 - Revision: 1