AMD-supplied chips. Kinect 2. Blu-ray support.
There's no shortage of rumors surrounding the next Xbox, code-named "Durango," and tomorrow (May 21) Microsoft is expected to clear the air in a press event hosted at its Redmond, Wash., campus. Ahead of the video game industry's massive E3 trade show in June, Microsoft will be making an announcement concerning the follow-up to the Xbox 360 and the future of one of the company's biggest successes in the consumer arena.
Since its launch in 2005, the Xbox 360 has been a consistently strong seller for the company despite some early quality control issues including the infamous "red ring of death," which refers to how error codes are depicted by the system's status LEDs, which encircle the power button. Kinect, Microsoft's motion-sensing peripheral, added fuel to the Xbox's sales momentum.
Meanwhile, mobile, handheld and social gaming have reshaped the video game industry. Yet for Microsoft, the living room still exerts an irresistible pull.
Aaron Greenberg, chief of staff for Microsoft's Interactive Entertainment Business, revealed during the May 17 Major Nelson podcast that $65 billion was "spent last year worldwide on games." It's a figure that includes game software and dedicated hardware across all platforms (consoles, PCs, mobile, Web and handhelds).
According to the company's data, of the $65 billion video game market, "$27 billion is console, which is 42 percent of the total global spend on gaming," said Greenberg. "The macro trend is that people are playing more video games today than ever before and they're doing that across a variety of devices," he added.
"Worldwide now, there's 1.2 billion people playing games," Greenberg said. In terms of U.S. revenue, the console market is on par with the box office with $11 billion in sales. Considering the size of the market, it's little wonder that Microsoft is eager to build buzz around the next Xbox.
The company is currently putting the finishing touches on an expansive tent on the soccer field of Microsoft's Commons campus in Redmond that will host the Xbox reveal event. Microsoft remains tight-lipped about what the event will encompass, except to say that the May 21 event will lay the groundwork for a campaign that will stretch into that holidays. E3, which takes place on June 11 to 13, will be "all about the games," according to Greenberg.
Nonetheless, industry watchers expect the new Xbox to be a return to an x86 architecture. Microsoft switched to IBM's PowerPC processors for the Xbox 360. The original Xbox was powered by an Intel Pentium III processor.
According to an April 8 report in Bloomberg, the new Xbox will house an AMD-based, x86 system-on-a-chip architecture called "Jaguar," similar to the one used in Sony's upcoming Playstation 4 console. The news article noted that Microsoft "stands to benefit because game developers, who have moved toward making games for PCs and mobile devices, will find it easier to deliver those titles for the next Xbox."
Kinect 2 is expected to make an appearance. However, one polarizing requirement, namely the widely rumored always-on broadband connection, won't be part of the proceedings.
In an internal memo obtained by Ars Technica, the company laid to rest the controversy over offline use. Microsoft "Durango [the code-name for the next Xbox] is designed to deliver the future of entertainment while engineered to be tolerant of today's Internet," stated the email memo.
"There are a number of scenarios that our users expect to work without an Internet connection, and those should 'just work' regardless of their current connection status. Those include, but are not limited to: playing a Blu-ray disk, watching live TV, and yes playing a single player game," wrote Microsoft.