Microsoft gives Xbox a big push

Times Staff Writers

Microsoft Corp. announced a slew of partnerships Monday calculated to draw customers to its Xbox 360 video game console and its online marketplace, Xbox Live.

The deals unveiled during this week’s E3 Media & Business Summit at the Los Angeles Convention Center include one with Netflix Inc. to bring 10,000 movies and television shows to Xbox Live subscribers, doubling the number of shows and videos that had been available on the console-based online service.

The Redmond, Wash., company also said NBC Universal had agreed to start offering content for downloading on Xbox Live, joining Walt Disney Co. and its ABC network.

Microsoft took the stage at the 14th annual E3 conference, put on by the Entertainment Software Assn., at a time when the video game industry is going through growing pains. But for Microsoft, it was a day to crow about the growth.


Microsoft said it had sold 10.3 million Xbox 360s in North America since launching the device in November 2005. Executives onstage predicted that they would ultimately sell more consoles than Sony Corp.'s PlayStation 3.

The company also said it collected more than $1 billion in revenue from its 12 million Xbox Live members, who have bought games and TV shows and rented movies via the Xbox 360 console. The figure doesn’t include a small but growing stream of advertising and sponsorship revenue, Xbox General Manager Dennis Durkin said.

It does include millions of songs packs sold for music games, including Guitar Hero and Rock Band. The company said it sold 80% of all songs downloaded for these two hit franchises. The rest were on PlayStation Network, Sony’s online platform for the PS3.

To entice buyers who want a place to stash all that digital content, Microsoft on Sunday announced that it was trimming the price of its 20-gigabyte console to $300. It also unveiled its Xbox 360 Pro system with a 60-gigabyte hard drive, to go on sale in August for $349.


With an increasing portion of its sales coming online, Microsoft plans to give Xbox Live a makeover. It unveiled a slick new interface and said it would give players the ability to create customized avatars through a software update this fall. Players will be able to form groups to look at photo streams, watch movies or compete in trivia contests.

The Netflix announcement is part of a battle being waged over which device and service will become the entertainment hub in people’s homes. For those who want to watch movies downloaded from the Internet on their TVs, having an Xbox will make it easier, executives said. Netflix already has a partnership to stream videos over the Internet to television sets through a set-top box made by Roku.

The streaming service will be free to Netflix members who also subscribe to the Xbox Live Gold membership, which costs $50 a year. Microsoft said a majority of its 12 million Xbox Live members pay the annual fee, but did not state how many.

Microsoft executives said they were wooing developers who were once close allies with Sony’s PlayStation platform.


Microsoft added more friends to its lineup Monday, including Capcom Entertainment Inc., which will bring its Resident Evil franchise to the Xbox. Also joining the lineup is Square Enix’s Final Fantasy XXIII, which has shipped more than 85 million units.

“Final Fantasy joins a list of former PlayStation franchises finding a new home on Xbox 360,” said Don Mattrick, Microsoft’s senior vice president for interactive entertainment.