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X-Box alert! Microsoft got game?

The truth is out there: With the purchase of 'X-Box.com', the software giant looks ready to unveil its game machine in two weeks. Will it be an industry crusher?

Microsoft is getting ready to declassify its long-secret gaming X-file.

Last week the software giant completed the purchase of the X-Box.com domain name, lending that much more credence to the industry buzz that it's creating a next-generation gaming platform -- known as the "X-Box" -- to compete with Sony Electronics' upcoming PlayStation 2 and Nintendo's device, code-named Dolphin.

Moreover, game developer UbiSoft let slip that a coming game, based on the TV series "VIP" and starring Pamela Anderson Lee, will also run on the X-Box platform when it hits shelves in the fall. The announcement hit the wires on Friday in France. A US-based spokeswoman would not comment on the faux pas. Microsoft could not be reached for comment.

The still-unannounced platform is expected to run Windows-compatible games using a console-like device that connects to the TV and can play DVDs.

Microsoft "really sees how popular the consoles really are, so they kind of want to appeal to that market," said Matt Gravett, games analyst with market watcher PC Data. "It would be hard for an upstart to get into the market, but Microsoft has a little bit more going for it," he added dryly.

The purchase of the domain name comes two weeks before the Game Developer's Conference in San Jose, California, a major industry event at which Microsoft Chairman Bill Gates is scheduled to give the keynote speech. Many industry watchers expect the X-Box to be demonstrated there.

Last August, X-Box sightings filtered in from the European Computer Trade Show, where Microsoft reportedly held closed-door demonstrations for software developers. With the expertise of its WebTV Networks subsidiary, the company could easily support Internet features, such as chat and multiplayer gaming, in the device as well.

Sources familiar with Microsoft's plans expect the devices to use either Intel's Celeron processor or Advanced Micro Devices's Athlon processor, in addition to 64MB of memory, a 4GB hard drive and the latest graphics chip from nVidia

From Universal Plug and Play -- a Microsoft-led initiative designed to link all sorts of appliances in one huge data network -- to the company's WebTV set-top box bringing Internet into the living room, Microsoft has signalled its intent to be a major player in the coming home-appliance market.

Since roughly half the homes in the United States still don't have a PC, the software giant has had to rethink its PC-centric strategy.

There's little mystery to Microsoft's motives. The new goal could give the giant a large part of the approximately $7bn (£4.3bn) that the interactive entertainment industry pulled in last year and a heavy portion of the $300m generated by DVD player sales in 1999.

"There are three major sources of revenue (in the living room): games, Internet and TV," said Alan Yates, director of marketing for the WebTV platforms division, in an August interview. "The people that put together the most compelling product based on a combination of those subsidies will be very successful."

But will Microsoft get the mix right?

Sm@rt Reseller's Mary Jo Foley contributed to this article.

Bill Gates is like a pushy salesman. If he can get one foot in the door, he'll barge on through. Go to AnchorDesk UK with Jesse Berst for the news comment.

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