Microsoft's Xbox is More Than Just a Game Console

NEW YORK ( TheStreet) - Microsoft ( MSFT) spent the better part of Tuesday bragging about what they're planning for the company's Xbox gaming console. The list of new features is quite impressive. So much so, that you realize that the upcoming Xbox One is a lot more than just a gaming device.

I won't try to explain every new feature in minute detail for fear of turning this column into a hard-cover, but it's interesting to see exactly what Microsoft deems for their 2013-era game console.

On the outside, Xbox One is just plain looking. Part of the reason for that ordinariness is that Microsoft's One can indeed also act as a cable/satellite pass-thru box for your HD video.

Inside, there is a very, very powerful computer. As predicted, there's an 8-core processor, state-of-the-art video chip, lots of memory and a 500 GB hard drive. What no one really expected was that there would be three operating systems inside. Parts of Windows 8, Windows RT and something new, an Xbox OS. They'll all work in harmony but each will control specific Xbox functions.

In case there was any question, the new Xbox user interface looks very familiar to Windows 8, Windows RT and Windows Phone users. The "Metro" family resemblance is obvious. In addition, as you might imagine, Microsoft-owned Skype is now an integral part of the system.

The new Kinnect 1080p sensor is now an integral part of the device - visible right up front. Kinnect will be able to watch and respond to your every move. It will also understand voice commands - from simple tasks such as turning on/off your Xbox, switching from one input to another or surfing the Web. There is also a new controller with buttons that will relay mechanical feedback.

Microsoft's online Xbox Live subscription service has been refreshed will new features such as the new "Game DVR" function will will allow fans to save, edit and share their feats of prowess with others. Games will be able to be played offline too.

Microsoft was very proud of the fact that one new game title, "Halo: The Television Series" will have the input of legendary producer/director Steven Spielberg. They also announced a new deal with the NFL

I've just scratched the surface but it appears that Microsoft is trying to make Xbox the Swiss Army Knife of set-top devices. It seems the company is offering all sorts of functionality on the hope that buyers will decide which features are most appealing.

If everything works as described, the Xbox One could be another big success, and therefore a big problem for Sony's ( SNE) new PlayStation 4. Since Xbox has been such a long-term financial success this new version could go a long way toward improving sales for related Microsoft products like Windows 8, RT and Windows phone devices.

We'll know soon enough. They're promising Xbox One will be in stores in time for the 2013 holiday shopping rush. No pricing has been announced.

Microsoft was falling 0.7%, to $34.60 in mid-morning trading.

--Written by Gary Krakow in New York.

>To submit a news tip, send an email to: tips@thestreet.com.

Gary Krakow is TheStreet's senior technology correspondent.

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