Will the Microsoft Xbox win the living room wars over Apple, Google?

Will the Microsoft Xbox win the living room wars over Apple, Google?

Summary: A new report says the Xbox is the most popular Internet device for TVs. Can Microsoft continue to capitalize on this advantage?

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TOPICS: Hardware, Mobility
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If you follow start-up culture, you know that the ability to "pivot" -- to change your business model on a dime -- can be the difference between failure and major success. But sometimes established companies -- even those often derided as dinosaurs -- can reap the benefits of pivoting as well.

That appears to be the case with Microsoft and its Xbox 360. Designed to compete with the PlayStation 3 and Nintendo Wii for gamers' hearts and minds, it's become something much more valuable -- the most popular conduit to the Internet in the living room. According to a new report from market research firm Forrester, the Xbox is the leader in the "connected TV" platform wars, bigger than Apple, Google, and any manufacturer's "smart TV" offerings.

About half of the 70 million Xboxes in use are connected to the Internet, and that install base has led companies from Comcast and HBO to Hulu and Netflix to offer streaming apps for their video services. Sensing that it has laid a golden egg with its Xbox Live subscription service, Microsoft has recently rolled out a wrinkle in its pricing strategy, selling a package (as a pilot program) that includes an Xbox 360 (with Kinect) for $99 with a two-year subscription to Xbox Live for $14.99 per month. The lower console price will get more units into homes as the company works on its follow-up Xbox.

While Microsoft has managed to establish pole position in the race to connect TVs to the Internet, its lead is by no means safe. It's been lucky that Apple has thus far treated its Apple TV device as a "hobby" and that Google TV has been a dud. But an Apple television -- when and if it arrives -- could alter that equation, especially since it could unleash the iTunes App Store in a way that Apple TV hasn't to date.

Speaking of app stores, Forrester analyst James McQuivey tells the New York Times that Microsoft could be leaving itself vulnerable to competitors by not opening up its app store further. It may be paying off developers to build apps for its Windows Phones, but it shouldn't have to be so desperate with 30+ million Xbox users who are connected to the Internet.

Do you think Microsoft will be able to hold on to its lead in the living room? If not, who will emerge as the winner? Let us know your thoughts in the Comments section below.

Topics: Hardware, Mobility

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58 comments
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  • Multi-use

    The Xbox works because it can cater to two very different audiences, kids who want to play games and parents who want to watch movies... and everyone in between, which is of course everyone!
    clcrockett
    • As far as movies go

      The PS 3 beats out the xbox, simply by having a Blu-Ray drive. downloads are slow, and streaming is not that great around here. I'm sure if I lived clser to a Major city, it might be different. This is only my opinion though, you opinion may not be the same.
      Jumpin Jack Flash
      • I dunno,

        I can't remember the last time I stuck a disk in a device. I watch streaming video, Netflix, or cable. If Xbox combines that functionality in one device, it's a winner.
        Geedavey
      • You don't?

        "I can't remember the last time I stuck a disk in a device. I watch streaming video, Netflix, or cable."
        So watching a 1080p Blu-Ray movie is something you're missing out on? Why limit yourself to downloading, or "streaming?" Aren't more choices better? Looks like Microsoft is restricting what you ca do, by not including functionality. Games that have 2 (or more) DVDs? can hold up to 8.4 GB of data, while Blu-Ray holds up to 50 GB (according to the spec).

        "If Xbox combines that functionality in one device, it's a winner. "
        If you're willing to accept lower limits for what a winner is. You can do more with a PS 3, or your average Windows PC.
        Jumpin Jack Flash
      • PS3 is a joke...

        Movie downloads on Xbox are extremely fast. 1080p streaming that can start about 30 seconds after starting the feed. If your only experience with streaming movies comes from a PS3, I can understand your desperate cling to the blu-ray discs, as downloading ANYTHING from PSN is an exercise in frustration. Blu-ray is not the way of the future... it's called a stop-gap... luckily one that I was able to avoid altogether. Not to mention that 95% of all third party games run better and look nicer on the Xbox.
        kstap
      • kris_stapley

        The joke's on you. The xbox is a pathetic piece of hardware. When Microsoft has to claim the only number that counts, is what shipped out of a Foxconn Factory in China. While everyone else counts how many are sold. When you see people that are on their 6th or 7th refurbished unit, from Microsoft, it speaks volumes of the device's quality.
        Jumpin Jack Flash
    • that will soon change

      Google will deliver free platforms backed by genial advertising support.
      The Linux Geek
      • They already did that and nobody wanted it. ask logitech how that went for

        them. yeah.
        Johnny Vegas
      • So they plan on copying Hulu?

        Free streaming, but you still have to sit through commercials -- usually the same ones over & over ad nauseum?

        Doesn't sound very innovative, or desirable, to me...
        spdragoo@...
      • Did you hear the one...

        about The Linux Geek commenting on a Microsoft-related article and having it hidden to low ratings?
        ikissfutebol
  • so this article is about app-stores?

    if it's about app stores and taking into consideration what you have said in your article, then Microsoft will also be able to "pivot" once again. however, on current xbox architecture its not really a viable option seeing that apps and games gets almost full control of the system. rogue apps and barefaced devs could reek havoc on the xbl service which isn't something I would want to look forward.

    I'm sure if the rumors are true then the next xbox could quite possibly see that needed architectural change as Microsoft would be placing a specially crafted Windows 8 version on the system, where WindowsRT apps and games could have access to a very engaging audience of millions.

    At this point i'm more interested in what Microsoft will do than what Apple or Google have up their sleeves.
    blazing_smiley_face
  • Will the Microsoft Xbox win the living room wars over Apple, Google?

    Yep!
    Loverock Davidson-
  • I'd support but not yet

    I've been a long fan of the Xbox in the living room however no matter how much I try to make it my central device, it falls flat on its face in one respect. It doesn't play the wide range of media files devices like WD live or Boxee or others can.

    I love the Xbox streaming and apps but then I'll go to play some recorded shows or ripped DVD's off my computer and I get annoyed when the Xbox can't play the file types or support the codec used. If they really want to make it "the device" they must make the device more compatible instead of making me make files compatible with it. It's not worth my time. I'd rather buy a Boxee/WD/etc that can do the streaming as well as play all file types as well.

    It's a shame really, I have been holding out on buying one of those other boxes waiting for better codec support to be added to the Xbox but I may bite the bullet and just get one. If I do, then I would imagine that other box would become my main streaming/video service device in the living room. The only piece those boxes don't cover I believe would be streaming HD movie rental which I currently use Zune/Itunes for.

    So...yep...support it....know they can win it but comon....there are some basics that they need to do to win that spot.
    chrisconnolly
    • TVersity

      Try using Tversity on your pc then you can stream any media format on the xbox.
      rruffman1
      • Yes, AppleTV Flash does the same for the AppleTV

        The AppleTV has a similar decoder for odd formats, great stuff!
        -
        http://firecore.com/atvflash
        Pederson
    • That is why...

      My entertainment is centered in a HTPC with Windows Media Center and XMBC on it. I can play whatever I want, in whatever format and stream to whatever device I have in my network.

      General purpose devices still beat single purpose ones.
      czorrilla
  • AppleTV sells more units, has wider support...

    The Xbox is rarely used as a set top box, the content just isn't there, while Apple's TV box has stormed the market in recent years and is the biggest unit seller. The main advantage of Apple's approach is it's fully open, (just like the iPod) so you can drag and drop most any modern content into it, and it plays.

    Throw in the remarkable innovation of Apple's "Airplay" and every newer iPhone and iPad can wirelessly stream directly into your television with zero wires.

    So everyone will end up with an AppleTV since it's only $85 and has millions of hours of free content, plus anything you currently have in your library.

    http://store.apple.com/us/browse/home/specialdeals/ipod/apple_tv

    much more here:

    http://www.apple.com/appletv

    -
    Pederson
    • I do not know a single person that owns an AppleTV

      nt
      Your Non Advocate
      • But that means you aren't technically advanced...

        Everyone who is involved with computing owns an AppleTV, so it sounds like you aren't a technical person, that's all.
        Pederson
      • Learn why your note is worthless

        Allow me to suggest a course in elementary statistics.
        Robert Hahn