Microsoft Gets Closer To Owning Your Living Room

Remember back in November when Thomas Hawk (yes, that's me) wrote that the XBox 360 would represent Microsoft's (MSFT) Trojan Horse (in a good way, not in a virus way) in your living room?

Yesterday Microsoft took one step closer towards its master plan of living room domination with the powerful secret weapon in its popular XBox 360 gaming unit, the extender functionality. Microsoft announced the upcoming availability of the XBox 360 Elite which will include a 120GB hard drive and will increasingly be marketed and positioned as an entertainment hub, even more than a gaming machine.

And I have to say it's brilliant. I'm glad to see Microsoft taking a more aggressive position with regards to the XBox 360 as a home media distribution platform. I'm sure that in part this marketing message has been crafted to counter Apple's (AAPL) recently released iDongle for your TV.

XBox 360 vs. AppleTV

So what's the major advantage that XBox 360 has over AppleTV? It's simple really. 90% of it comes down to HDTV. People continually underestimate the importance of HDTV. Microsoft is much further ahead than Apple in the ability to deliver HD content to your living room. Apple's picture quality looks like crap. And there seem to be no obvious plans for Apple to begin offering a cable/satellite based DVR solution for its Apple TV initiative anytime soon.

Microsoft, on the other hand, will very shortly have available new Vista machines (and upgrading with a new PC is probably the best way to upgrade to Vista) that work with CableLabs- approved HDTV tuners. These HDTV tuners will allow you to record premium HDTV content from your cable provider to your Media Center PC, and then ship this high quality programming to any TV in your house equipped with an XBox 360.

Let's Talk Value

What's more, best I can tell, there will be no additional charges from your cable company beyond the typical service charge to distribute to multi rooms in your house. At present, although Apple may be sexy and have marketing and advertising prowess that Microsoft can only dream of, it just can't compete with the superiority of the XBox 360 as a home media hub.

And even if you don't want HDTV, the XBox 360 will work with any XP or Vista machine equipped with a standard definition TV tuner. Since most people already pay a cable or satellite provider for TV service, recording this content on your Media Center PC involves very little additional cost. Getting this content to your living room without having to buy it and pay anything additional to iTunes represents real value.

Although a lot of people talk about a la carte pricing being better than cable or satellite monthly bills, very few people are abandoning their cable or satellite provider yet. And because the Media Center PC/Xbox combo can use your existing cable or satellite signal your content effectively becomes free vs. paid at Apple.

On top of it all, the XBox 360 is a kick ass gaming platform. I never thought I'd appreciate this as much as I do now that I own one.

Comments

[Jon T:]

And it's doomed to failure. Who - apart from teenage gamers - want to have to deal with a noisy, powerful X-box just to watch a film?

Sorry Thomas, you are miles out on this one. Just not going to happen. Microsoft has already overstuffed the channel to overbrimming to inflate the X-Box sales numbers;

PSP3 and Wii are running rings around X-Box despite its being a year ahead of them...

Here's as good a rundown as you'll find of the real X-Box position:

www.roughlydrafted.com...

2007 Mar 29 06:31 AM

[moosebump:]

First, lets not make the limiting assumption that all gamers are teenagers. Every year the average age of gamers is likely increasing as those who grew up gaming -and never stopped- get older. I believe that one day gaming will be a form of entertainment that isn't limited - or seen to be limited - to a certain demograhic.

However, I agree with Jon T (and disagree with Thomas Hawk) that the 360 will not be the successful Trojan Horse MSFT hopes it is. 90% of it will come down to ease of use. If Apple can make an easy to use convergence device that unites TV and PC technology then they may have a winner. The 360 is NOT easy to use as a convergence device. It is buggy and hard to set up. I am a gamer and a moderately geeky and yet I am often running into issues with the connectivitiy and setup. Could my wife figure out how to record a TV show on our PC and then watch it on the TV through the 360? Forget it. Would she be able to do something like that on the AppleTV? My guess is yes.

If a gaming/convergence device is what would win then Apple should partner with Nintendo to slap an inexpensive game console togther with the AppleTV.

The iWii.

2007 Mar 29 08:34 PM

[Julian Ivan...:]

Jesus Christ, who are these bozos? Add a $50 USB tuner to your Mac, and you can use it as a better PVR than anything available on a PC thanks to the fantastic Elgato software, which integrates with Front Row seamlessly and saves recorded content to iTunes - where it can be played back through the Apple TV in your living room.
A Mac+TV tuners and an Apple TV is all you need for the best PVR system on the planet.

2007 Mar 29 08:25 AM

[frankz00:]

Chuckle, chuckle. Snortle, snortle. Sure they'll own the living room... All this is is WebTV3. AppleTV is going to blow it away because it's a simpler design. That's how Apple always gets the edge when it comes to consumer based products. Microsoft tries to out geek everyone else. The problem is.... it's not cool to be a geek! I'm a geek telling you this. Besides, if it's not Apple, it'll be Sony dominating the living room before anyone else has a chance.

2007 Mar 29 08:55 AM

[Tom B:]

"So what's the major advantage that XBox 360 has over AppleTV? It's simple really. 90% of it comes down to HDTV" I think what you are missing is that Apple TV is a new product. MSFT has HD content; Apple TV might not for a few months. This hardly constitutes a durable advantage for MSFT. VERY short-lived, I would think.

2007 Mar 29 11:50 AM

[David Lentz:]

"Apple's picture quality looks like crap."

Yeah, I guess if you do the minimal 10-15 seconds of "research", you might arrive at that conclusion.

However, I find that even the default level of quality you refer to as "crap" to be pretty good, and more to the point, find that I am able to rip commercial DVD content (ones I purchased, not pirated media) and display it via the AppleTV with result indistinguishable from playback of the physical DVD through a set-top DVD player.

So it appears that the AppleTV IS able to display HD content, but that the ICT tag present in broadcast media (TV shows) forces the downgrading of the image quality.

I suspect that the Xbox will suffer the same downgraded image when displaying HDTV programming.

But then, you've not bothered to "research" that, have you?

2007 Mar 29 12:06 PM

[peter02l:]

The title is a wee bit over the top. Microsoft announces a couple of changes and additions to XBox 360 and they will own my living room? All three game console makers put together aren't enough to own our living rooms, and remember Microsoft is way behind Sony and Nintendo in installed base. What's next, is Nike going to own my shoe rack?

2007 Mar 30 12:05 PM

[whoisjarod:]

Anyone who thinks that Microsoft has a lead in anything but garbage is a serious idiot that deserves to use their crap.

2007 Mar 31 01:06 PM