Microsoft Prepping Update to Xbox 360 with Internal HD-DVD Drives

[Jason Dunn]

<div class='os_post_top_link'><a href='http://www.dailytech.com/article.aspx?newsid=4161' target='_blank'>http://www.dailytech.com/article.aspx?newsid=4161</a><br /><br /></div><i>"DigiTimes has recently published an article claiming that a Taiwanese manufacturer has been selected to produce an internal HD DVD drive for an upcoming XBOX 360 revision. The report does not indicate which manufacture is responsible for the drive. The major Taiwanese optical storage manufacturers include Lite-on, Quanta and ASUS -- any of which would be likely to build an HD DVD drive for Microsoft. However, with ASUS manufacturing the majority of the components for the Playstation 3, it would seem more probable that Quanta or Lite-on is the manufacturer for such a drive, if it exists."</i><br /><br />An interesting development, if not unexpected. I wonder what will happen to the price - I can't imagine it going up, nor can I imagine Microsoft wanting to sell a third SKU of the Xbox 360. My hunch is that the Premium will get the HD-DVD drive, while the Core system will not, and prices will remain about the same. Myself, I'm still looking forward to being able to get the external HD-DVD player and buying a copy of <i>The Last Samurai</i> in HD-HDVD... :D

[Chris Gohlke]

Here is my guess at the strategy. Pop the HD drive in the Premium, leave the price at $399. Lower the core to $249. The core will be priced near the Wii for the entry level part of the market and the Premium will undercut the PS3 severly. Possibly make an external HD drive for around $100-$150 and give the entry level the ability to upgrade over time.

[Jason Dunn]

Possibly make an external HD drive for around $100-$150 and give the entry level the ability to upgrade over time.

Actually, the 20GB hard drive is an add-on accessory now - the Premium package just has it bundled in, you still attach it to the top of the Xbox 360.

[Felix Torres]

Actually, there were rumors of *three* XBOX II (as it was known at the time) in development way back in early 05. And before that, there is the old HomeStation Xbox prototype that combined full MCE with XBOX gaming.

So MS has long been pondering a PSX-type upscale product to sit at the very highest end of the XBOX sku hierarchy.
It may be we're seeing the preliminaries for a january CES intro of a standalone Media Center 360:

- Built-in HD-DVD
- Massive Hard drive, 3.5", 200-300Gb range
- HDMI (remember those pictures floating around of a 360 mobo with HDMI port? maybe they weren't Photoshopped after all...)
- DirecTV integration (long rumored)
- Maybe even built-in PVR (hopefully cablecard capable)

Throw all that into the mix for $599 and watch Sony execs reach for the antacid. ;-)

If nothing else, the timing is right: september sourcing for late december production, January intro, and march shipment. Could even be the cornerstone of Zune...

[Jason Dunn]

Oh my...you're so right Felix, I do remember the rumblings about the Xbox "digital home" concept that was being murmured about. Wow. If they did something like that... 8O

[Felix Torres]

Was it really four years ago? How time flies when you're having fun!
It all started at the yellow rag:
http://news.com.com/2100-1040-814653.html
http://www.theregister.co.uk/2001/09/07/microsoft_preps_xbox_2_as/

And, of course, the inevitable denial:
http://www.xbox-scene.com/xbox1data/sep/EpEFAuZuyEGCbcoBVK.php

The meat of the exercise, however, lies in this quote:

Chief Executive Steve Ballmer told an analyst conference there was a ``bigger play'' than video games the company hoped to eventually achieve with the Xbox.

Microsoft was exploring lots of possibilities in the areas of interactive television and PC-based digital entertainment, Brewer said, adding some of those ideas could eventually make their way into the Xbox.

``In the longer term do we have plans like that, but there's nothing concrete in the works yet,'' Brewer said.

[Jason Eaton]

Now that would draw some attention.

I wonder (if true) what they plan to do for game distribution. Would games still be in regular DVD format? Or do they plan to fracture the gamer base by having some games in HD DVD format only?

Some careful decisions need to be made there or else the simplicity of consoles gets a little clouded. The dreaded christmas morning "Mom this is an HD DVD game I can't play it!"" But it says Xbox 360 on it, right next to the guys head exploding, Jimmy."

[Felix Torres]

The games on such a hypothetical device will remain on DVD9.

The party line from MS is that most high-quality games of the current gen use less than half the available space on a 9Gb DVD so that should be plenty for the next three years or so.

Worth noting: PS3 fans point to Sony's in-house FPS (Resistance: Fall of Man) as proof that you need blue laser disks for next gen gaming, but when developers talk about how the 22 GB of the game are allocated, it turns out they use pre-rendered HD cut-scene video. Just like BD-ROM movie releases on MPEG2, their product uses up a lot of space because a lot of space is available.

A lot of XBOX and 360 games, in contrast, generate their cut-scene and scripted video on-the-fly using the graphics engine. Which allows the scenes to be context-sensitive to the character's customized look and definition. For example: Some of the more amusing scripted scenes in Oblivion feature post-combat chats with NPCs whose armor has shattered and they stand there in their skivvies with gauntlets and a sword and little else.

So, keeping in mind that these boxes are *supposed* to generate HD quality video on the fly, there is no inherent need to stream pre-rendered video off the disk; it is purely a design choice. Sony, since they have a point to make about their higher capacity disks, chooses to fill up as much of the disk as possible. That does not mean other developers have to do the same, though. BTW, that showcase game on the PS3? It renders at 720p so the onboard video eating up the 22Gb isn't likely to be 1080p. I'm guessing they're not really compressing that stuff much, if at all. And considering the lower data transfer rates of the BD drives, *increasing* the volume of data that needs to load of the disk doesn't seem to be the most desirable path to take...

It'll be a while before we know who's right but until we actually start seeing multi-disk releases for 360 that require swapping, the odds are that the 360 versions of multiplatform games will come on the same number of disks as their PS3 counterparts: 1.

BTW, do remember that BD media is more expensive than old DVD media. That means higher manufacturing costs for the games. There's a reason Sony has spoken of game prices being higher than $60...but not necessarilly $100 or some such.

MS designed the 360 to different guidelines than Sony and one of those guidelines was that it had to be cheap. They want to make money on the thing by next year so they can start cutting prices as soon as possible. Bottom line is the 360 will hit lower prices sooner than the PS3 and one way MS is going to get to $199 a lot sooner than Sony is by sticking with DVD9.

[Jonathon Watkins]

Oh my...you're so right Felix, I do remember the rumblings about the Xbox "digital home" concept that was being murmured about. Wow. If they did something like that... 8O

Heck, I'd buy one. :)

[Phoenix]

I'm SO glad to hear this. I've been holding off purchasing a 360 until it includes an internal HD-DVD drive. I can't stand add-ons. I also wish it would offer integrated WiFi, but I digress.

I'm also interested in seeing it evolve into something of greater flexibility with the features that Felix was mentioning and I talked about these ideas myself back when the original Xbox was first released. I'm not a satellite user, so DirectTV integration isn't something I'd be interested in myself, but cablecard capability and HD TiVo-like functions along with a very large HDD would be very welcome additions.

HD-DVD and HDCP HDMI, DVR, Cablecard, gaming, media, and WiFi all in one box would be fantastic.

[Felix Torres]

Lots of us are waiting to see MS unleash the 360 from the MCE-protecting shackles.
Hopefuly they will, but if they choose not to, well...
Sony and Nintendo are *not* going to shackle their boxes.

I have no problem with moving to a PS3 as a media box once the price gets reasonable, say in 2-3 years. I'd rather do it on the 360, but that is not up to me; whoever gives my what I need gets the business.

Two things along this line of evolving the 360:

1- The 360 dashboard group has recently been soliciting input on 360 software improvements users want. The most requested? A browser. Right up there with video playback sans-MCE. Preferably via USB storage. They can't claim they haven't been told users want this.

2- A recent workaround appeared that allows the 360 to display RSS feeds and "podcasts" remotely via the UPnP client. Its still streaming and I'm not as gung-ho for streaming as I was in the past but if it strikes anybody's fancy, its out there...

MS needs to get going; they have the high ground today but that lead won't last if they don't let the hardware do what it can do and customers need.