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Microsoft leaks details on Xbox Next

PLANS REFLECT HARD-FOUGHT BATTLE WITH SONY FOR GAMERS' DOLLARS

By Dean Takahashi

Mercury News

Microsoft has quietly circulated the specifications for its next-generation Xbox video-game console, indicating how the company plans to carry on its war against dominant player Sony.

The details suggest Microsoft is far more concerned about keeping the cost of its Xbox Next console low than it is with including dazzling technological features or driving its rivals out of the business, according to a variety of industry sources.

People familiar with Microsoft's strategy say the company apparently believes it can capture a much larger share of the market if it launches its machine before Sony fields its PlayStation 3 console in 2006.

A Microsoft spokeswoman declined to comment on strategy details.

The new Xbox reflects some tough lessons learned in the current console battle, in which Sony has outsold Microsoft 5 to 1. The Xbox has put Microsoft on the map with a generation of gamers. But it has also been a money loser, albeit a relatively small one for a company with $53 billion in cash.

Microsoft launched its Xbox console 20 months after the PlayStation 2 debut. By the time Microsoft sold 1.5 million consoles, Sony had sold more than 20 million PlayStations. To date, Microsoft has sold 13.7 million Xboxes, while Sony has sold more than 70 million. In the United States alone, console sales amounted to $3 billion in sales last year.

For gamers, the new Xbox will be impressive, giving them the ability to play fast-action, realistic 3-D games on a high-definition TV set. Microsoft's emissaries have told industry developers and publishers that the next Xbox will be ready to launch in fall 2005 with the following specifications:

• Three IBM-designed 64-bit microprocessors. The combined power of these chips means the Xbox Next will have more computing power than most personal computers. The chips are used in Apple Computer's high-end G5 PowerMac machines now.

• A graphics chip designed by ATI Technologies with speeds much faster than its upcoming R400 chip for the personal computer. This chip will help the next Xbox to display games with the resolution of high-definition TV.

• Compatibility with the original Xbox, which is based on Intel and Nvidia chips, isn't guaranteed. Microsoft is concerned it would cost too much money in hardware or in licensing fees to enable the Xbox Next to play old Xbox games. This is risky in part because Sony's strategy has been to maintain compatibility with its old consoles.

``I can't imagine that Microsoft would be so insanely stupid as to make it incompatible,'' said Jon Peddie, an analyst at Jon Peddie Research in Tiburon.

Microsoft is leaving itself wiggle room to react to competitive moves by Sony and Nintendo. A few details are to be decided. In contrast with the current Xbox, the next one will have no hard disk drive -- unless Sony puts one in the PlayStation 3. Instead, the console will rely on flash memory to store saved games and permanent data, much like the current PlayStation 2.

The machine also will have about 256 megabytes of dynamic random access memory. But Microsoft will upgrade that to 512 gigabytes if Sony puts in more. The previous Xbox had 64 megabytes. And lastly, it isn't clear if Microsoft will include the current DVD video technology or Blu-Ray, its successor. Blu-Ray will hold much more data, but it's unclear when it will be ready for market.

The current Xbox has an eight-gigabyte hard disk drive. That drive is useful for online games and storing game art, but many developers chose not to make use of it. As a result, Microsoft seems to have decided that saving the $50 the hard drive costs outweighs its benefits.

In telling the developers what will be in the box, Microsoft is helping them get started on games that will be ready when the console launches. But it is also soliciting feedback, and some developers are pushing Microsoft to make changes.

``I would really like to see a hard disk drive in the box,'' said Tim Sweeney, chief executive officer of Epic Games in Raleigh, N.C., who has made his opinions known to Microsoft. ``For a console to really have a useful online component, it has to have the hard drive to store downloaded maps and other data.''

Sweeney says it is dangerous for Microsoft to wait until Sony reveals the details of the PlayStation 3 or to pay too much attention to cost issues.

``Sony isn't as motivated to launch a new console because it is No. 1,'' he said. ``If Microsoft waits for them, it is in effect allowing Sony to design Microsoft's box.''

Regarding cost issues, a Microsoft spokeswoman would only say, ``Microsoft is in this for the long term.''

Developers like Sweeney say they are pleased it will be apparently easy to develop games for Microsoft's new box. That was one of the main advantages that Microsoft has had over its rivals. Current information about the PlayStation 3, sketchy as it is, indicates that it could be extremely difficult for developers to master.

The top executives of both Electronic Arts and Activision said this week that they have not received formal ``software development kits'' from Microsoft yet, but they did say they have begun creating next-generation games. Internally, Microsoft has begun developing game prototypes, and it is using G5 systems to do so.

The same developers who have seen the Microsoft specifications say Sony hasn't shared as much data with them. Sony appears to be willing to wait until 2006, in part so that it can milk the profits from the current generation PlayStation 2. In the meantime, Sony is launching an all-in-one PS 2/video recording box dubbed the PSX and the PlayStation Portable.

Microsoft's schedule may change -- it has a big meeting coming up for developers this month. But for now it appears it will release information about the new box at both the Game Developers Conference in San Jose in March and at the Electronic Entertainment Expo in Los Angeles in May.

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Dropping the hard drive would be a major suck-fest. As Hitcher mentioned, although Microsoft said it wouldn't be patching games via live, we've had so many updates through it, that it would be impossible without the drive. I also like having my own soundtrack. Maybe it's a piracy combatting device, maybe it's just to keep the cost down.. whatever, it's a giant leap backwards

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They will probably sell the HD with the Live kit. That way only those who use them (the way MS want you to use them I mean) will have them. MS could probably subsidise the HD to a cheap price as each Live subscriber is a source of revenue.

Hmm thats what I was thinking, the next Xbox has to have a HD at some point imo

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Guest Two Heavens
The argument of keeping the cost down with the lack of a HD is completely rebutted by the specification of three off the shelf processors.

As I said, bucket of salt required.

It's not 3 off the shelf processors.

64 bit IBM cpu does not equal G5, no matter what this particular article says. The G5 was developed for Apple from the generic IBM Power PC 970 architecture.

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The machine also will have about 256 megabytes of dynamic random access memory. But Microsoft will upgrade that to 512 gigabytes if Sony puts in more. The previous Xbox had 64 megabytes. And lastly, it isn't clear if Microsoft will include the current DVD video technology or Blu-Ray, its successor. Blu-Ray will hold much more data, but it's unclear when it will be ready for market.

512 gig? Shurely shum mishtake?

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current DVD video technology or Blu-Ray, its successor. Blu-Ray will hold much more data, but it's unclear when it will be ready for market.

WTF is this? does that mean we'll all be buying new 'Blu-Ray' players and scrapping our dvd collections soon then?

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They will probably sell the HD with the Live kit. That way only those who use them (the way MS want you to use them I mean) will have them. MS could probably subsidise the HD to a cheap price as each Live subscriber is a source of revenue.

Then expect far less games to have live support. Been proven time and time again that developers don't take risks on games which rely on periphrals (beyond controllers and memory cards)

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'New downloadable content available. Please insert memory card'

...

'Please insert another memory card'

...

'Please insert another memory card'

Nooooo.

Precisely...!

I think one of the reasons the xbox is popular with us (keen gamers) is its flexibility which stems mainly from the HD.

I thought the whole point of the next gen consoles was this "media hub" ideal that everyone seems intent on (looks at Sony PSX). Without the HD, you get no downloadable content, no "TiVO" style recording of TV or any other of the multi-media gubbins the PSX can do...

Maybe (and I hope someone from microsoft is listening), Sony is yanking MS chain and when they announce the xbox next has no HD, only 256 megabytes of dynamic random access memory and no DVD-R.....

Then Sony pops up with a HD, 512 megabytes of dynamic random access memory, DVD-R and a whole lot more gubbins...do you see?

Oh....and I just remembered....the amount of processors you have stuffed in your box (!!??) doesn't an easy console to program make ;) (saturn...jaguar??)

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I'm not aware of any 'required' peripherals for Live. The games are all perfectly playable without the headset.

Really? I didn't know that.

You DO need a subscription though don't you? Doesn't that involve buying a disk as well? The HD could come for 'free' with the subscription. This makes sense for MS and would make little difference to most Xbox owners who don't make much use of the HD anyway.

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Really? I didn't know that.

You DO need a subscription though don't you? Doesn't that involve buying a disk as well? The HD could come for 'free' with the subscription. This makes sense for MS and would make little difference to most Xbox owners who don't make much use of the HD anyway.

You sign up online. The disc isn't necessary, any Live enabled game carries the dashboard.

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I think I downloaded the whole thing. I turned on my Xbox for the first time (with it plugged into BB) and no game was in, and then it just did it's own thing... got Live, signed up, blahdy de blah... then put in a game.

All very nice and straightforward.

Just requires on your credit card ;)

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