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What I found was that pulseaudio was taking 50% processor utilization. Changed sound from HDMI to internal audio card and everything worked fine. Seems to be a problem with HDMI audio.
Sorry, I did not scan the list during my search for this bug well enough. This appears to duplicate Bug 754825 - ATI Radeon HDMI - speedy video playback and no sound on HDMI out
*** This bug has been marked as a duplicate of bug 754825 ***