The software giant unveiled the Xbox 360 during a pretaped MTV broadcast on Thursday night, edging out Sony and Nintendo to become the first to reveal details of a new console.
The most anticipated feature among the Xbox 360's specifications is its high-definition picture display. Pricing for the device hasn't been announced yet, but executives have said the console will be shipped in Asia, Europe and North America by the holiday season.
Microsoft timed the announcement to hit before the start of a major gaming industry trade show, the Electronic Entertainment Expo, set to take place in Los Angeles next week. The move pre-empts launches from rivals Sony and Nintendo, which plan to demonstrate their own systems at E3.
The new systems are expected to revitalize the gaming industry, which typically sees an upgrade cycle in consoles about every five years.
Microsoft is slightly ahead of that schedule, likely because it's eager to get leverage from the games foothold it got with its first Xbox, launched in 2001, and to get a jump on its competitors.
"We have been working on this for three years--twice as long as we did for Xbox 1," said J. Allard, a Microsoft corporate vice president. "We didn't have the team last time, we had the dream...We had an incredible amount of infrastructure (relationships with publishers and developers) to build up, and our initial Xbox was more to get a seat at the table."
Under Xbox's hood 
"Microsoft is better prepared this time around than last time," said Schelley Olhava, a games analyst with research firm IDC. "They put more thought into everything down to the controller, which feels more natural in your hand."
Olhava estimates that once the new generation of consoles are on shelves and games are released, Microsoft and Sony will constantly trade out the No. 1 market share spot in North America. For some time, the Japanese company has held the top position for consoles shipped by a wide margin.
Under the hood
The Xbox 360 will display games in high definition when used with HDTVs, but it will scale down to the best resolution of the television set, Microsoft said. In addition, the redesigned white console will be able to connect to the Xbox Live marketplace using a built-in Ethernet port and broadband Internet access. At the marketplace, gamers will be able to download content such as new game trailers, new game levels, weapons and vehicles for games and more.
The console will come with a 20GB detachable and upgradeable hard drive and a 12x dual-layer DVD drive that reads DVD, DVD-R/RW, DVD+R/RW, CD-R/RW, WMA and MP3, among other formats. It will also stream media from other Windows XP-based PCs, Microsoft said.
Despite all these features, Olhava said she expected none will have as big an impact as the support of game makers. During its initial effort, Microsoft was slow to get a rich portfolio of third-party games for the Xbox.
Microsoft expects that to be different this time around. Representatives said that by the end of this year, there will be 25 to 40 titles supporting the Xbox 360.
