The plugin makes the browser HD View compatible which means that you can use the advanced features of the plugin to interact with specially prepared images. Those large images normally don’t fit the screen and the user may use the mouse to move around and zoom in or out of the image.

Since the images are of high resolution it normally does not decrease image quality that much when you zoom in. Only when you reach the limits of the image you will notice the usual effects when zooming in on images like a reduced sharpness of it.

Microsoft HD View Normal:

Microsoft HD View Zoomed:

As you can see it is does not degrade image quality when zooming in on the image. Microsoft Research is offering information on how to produce and provide images for HD View. They are offering three methods which are described on this page, one of them is a Adobe Photoshop plugin.