The unveiling last week of the Xbox One represents Microsoft's latest weapon in
a war whose outcome is likely to either bulk up or shred the bottom line of more
than a few companies -- call it the battle of the living room.
And it's not enough it has to go head-to-head with Nintendo's Wii U console, which has a head start from its launch last November, and Sony's upcoming PlayStation 4: All three are battling for the heart and minds -- and credit cards -- of consumers increasingly turning to tablets and even smartphones for casual entertainment.
Streaming media on tablets, more and more games optimized for mobile phones or phablets -- is a gaming console, even one that desperately wants to be an all-around entertainment hub, even relevant anymore?
Microsoft certainly hopes so, and wants -- let us say needs -- a piece of that pie: It wants to be the "one box to rule them all" for everything from gaming to music to playing DVDs and even streaming live TV -- the home entertainment system for the 21st century.
"Today we put you at the center of a new generation in the living room -- where your games look and feel like nothing else, where your TV becomes more intelligent, where all of your entertainment comes alive in one place," Microsoft's games division head Don Mattrick said during the Xbox One announcement at the company's Redmond, Wash., headquarters last week.
Computer gaming is a $65 billion market, but with more and more of it going to tablets and smartphones, the makers of traditional gaming consoles -- Microsoft, Sony and Nintendo -- must convince consumers there's a world beyond games, that a console can be the right choice for every kind of consumer entertainment.
But they must tread lightly so as not to alienate the hard-core gamers who made so many company fortunes in the past.
Microsoft is taking a risk there, announcing that the Xbox One will not support games designed for its predecessor, the Xbox 360.
That means a gamer who buys an Xbox One with thoughts of a newer, faster way to play his extensive -- and expensive -- collection of games will be out of luck, and will find himself owning two consoles, at least for a while.
Not quite the "one box to rule them all" that Microsoft is likely hoping to put into the world's living rooms to offer a blend of live television, music, movies, Web browsing, social networking, Skype phone and video calls and -- OK-- the occasional round of video games.
But it may be an uphill battle as the war of the living room sees incoming rounds from all sides -- Internet-connected TVs, tablets, smartphones and a bevy of other gadgets all vying for consumer interest.
Microsoft has to be aware of that, which is why it has gone with a strategy of offering up the Xbox One as an "all-in-one" entertainment system, rather than a single-purpose game console.
"It changes everything," Microsoft executive Marc Whitten said at the unveiling.
Perhaps; the question will be if it can keep up with even greater changes in what consumers expect -- and demand.
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