Xbox Vs. iTV – Microsoft drops a bombshell

Table of Contents

xbox.jpgForget iPod Vs. Zune –

the Apple/Microsoft war just officially

entered the living room…

From the Yahoo Biz Press Release:

Microsoft Corp. has teamed up with a handful of Hollywood studios to sell TV shows and rent movies that can be downloaded through the software maker’s Xbox Live online video-game service and beamed straight onto television sets.

The company announced Monday that beginning Nov. 22, Xbox Live users with the latest console will be able to choose from shows including “South Park,” which airs on MTV’s Comedy Central, and CBS Corp.’s “CSI,” and movies including Warner Bros.’ “V for Vendetta” and Paramount Pictures’ “Mission Impossible III.”

This is HUGE for several reasons…the biggest of which is that Microsoft has done something that Apple has yet to be able to do…get studio support for movie downloads from non-Disney owned studios.

An Xbox 360 Core System starts at $299. That’s the same price as Apple’s Upcoming iTV.[UPDATE: It has been pointed out to me that you have to have the $100 hard drive to access Xbox Live, so to be fair, we’re talking about $399 to use the downloading service]  Now, granted, you can spend significantly more on an Xbox 360 (especially if you include the HD-DVD drive), but if I was a consumer that wanted to watch downloaded movies and television shows on my television (which I am), I think I’d have to take a long hard look at the iTV before I purchased it over an Xbox 360.

I mean, if I buy an Xbox 360 I also get access to a ton of fantastic games – and right now, with the iTV I basically get to stream stuff from my Mac to my television. Now, the final curtain hasn’t been unveiled for the iTV yet – and Apple may have something up their sleeve that we don’t know about…but it’s not a next generation game console…that’s for sure.

What will Apple come up with to combat this…because this is a VERY real threat to the iTV product…and if the Zune is integrated with the Xbox 360 it may even be a blow to the iPod in the long run.

To me, it looks like Microsoft just pulled out the big guns, and this fight just got interesting.

Picture of Kossi Adzo

Kossi Adzo

Kossi Adzo is a technology enthusiast and digital strategist with a fervent passion for Apple products and the innovative technologies that orbit them. With a background in computer science and a decade of experience in app development and digital marketing, Kossi brings a wealth of knowledge and a unique perspective to the Apple Gazette team.

47 thoughts on “Xbox Vs. iTV – Microsoft drops a bombshell

  1. to mliving:

    1) You can’t play games while you sleep.. but you can download movies while you sleep.
    2) With network QoS. You can play games AND download movies while playing games, and make an IP phone call.

    3) Apple’s DRM is so far, better.. MS well..

    4) DRM is evil no matter what the logo. It’s still bad.

    I can’t wait to subscribe to TV shows instead of TV channels. I can almost do this now with the internet. So far there is no legal alternative.

  2. Isn’t there also the factor of X-Box live subscription? I haven’t read anywhere whether you need an active X-Box Live account in order ot make purchases or not… but if you do, then that’s around $5 per month approximately (depending on if you pay annually/etc.)

  3. You can also stream content from your PC to the 360 (videos, music, pictures), really the iTV offers significantly less then the 360.

  4. you don’t need the hard drive to access xbox live, a memory card will do but if you want to download the movies you need the HD

  5. “You can also stream content from your PC to the 360 (videos, music, pictures), really the iTV offers significantly less then the 360.”

    Rubish my friend the streaming capabilites of the 360 blow ass. Half the time it will not work or there are buffering issues. Setting up your MCPC to work with 360 is a complete crapshoot. You can guarentee that when Apple releases there product it will work and it will work well.

  6. well the questions I have to ask

    -do you need xbox live gold to download the media? (if so, $50US extra a YEAR) Also, how much will the shows be on top of this? Can I then transfer these movies and TV shows to a MAC and watch them or am I stuck with the xbox360 only? (i.e. when MS moves drops the 360 like a stone – like they did with the original xobx, can I move my media that I bought to another system?)

    -Zune can’t play MSN tunes which shows a lack of vision at MS. Where else will this type of chaos within MS show up? Pretty big slip up in my books.. you are screwing your existing customer base by doing that (you have to buy your music 2x now). One that you bought at msnTunes and again for Zune. Good job MS.

    my 2 cents – yes, my questions are more against the Xbox 360, but it’s only so, because you article isn’t exactly balanced and I thought I would add a counterbalance to your Fox like reporting.

  7. One thing you have to look at is who will want to buy these things. not everyone has a need to have a gaming consule and tv streaming. All someone may want is just something that gets the content from point A to point B. And the iTV will do just that and do a great job at it. I actually think that Microsoft is putting themselves into a hole but only having the 360 be the gateway to the content they offer. And as for content sake i think that if these studios are offering things to Microsft then Apple may not be far behind.

  8. Mliving, do you think XBox owners play games 24/7 or do you think there may be times they aren’t playing and all the bandwidth is usable for movie downloads? How about the XBox owners who are playing games, but not online games? Your ignorance is showing, please tuck it in.

  9. The iTV offers less? Correct me if I am wrong, but we don’t even know what the iTV offers since it hasn’t been released!

  10. > with the iTV I basically get to stream stuff from my Mac

    Actually, you will be able to stream stuff from a Windows PC running iTunes to the iTV too.

    But I’m sold on the 360. It rocks as a game platform. And it rocks as a media console.

  11. @mliving
    XBox360 has already incorporated background downloading–in between gaming sessions, a user can simply leave his XBox360 on (just like you do with your PC) and the system automatically resumes downloading. If you start an online game up, it pauses the download until you’re done playing online. I’ve never been a huge Microsoft fan, but they’re really getting their stuff together on the 360.

  12. I can do this with my Mac and my Gen 1 Xbox. Xbox Media Center installed on my XB can stream movies from my Mac flawlessly. Or I can FTP into my XB from my Mac and load up any videos I want, save those downloaded from iTunes. XBMC reads almost every format out there!

  13. mliving….what are you so bitter about. I own an XBOX 360 and its safe to say that I will be taking advantage of the new downloadable media…its not like I’m playing online games all the time. This is by far some of the best news….I can already stream media to my XBOX 360 using Windows Media Center and now your telling I get to download High-Def content to watch on my TV. Comcast OnDemand barely covers that with there very limited High-Def content.

    Something I have already payed for is going to enhance my entertainment experience. Now don’t get me wrong I don’t exactly agree with the statement that MS will eventually plow the iPod. Apple will always have a strong hold on the MP3 market, but the fact that my iPod also works with the XBOX 360…..I would be nervous if I was Apple.

    Also even though MS get a really bad wrap for their Operating Systems. I can say with confidence that XBOX 360 is the most stable piece of Hardware/Software that MS has ever built. Mainly for the same reason the iPod has become so user friendly. MS built the hardware and the software.

  14. I think this is more about posturing then a real shot across the bow.

    The WHOLE purpose of XBox Live is for players to play their games with other players. And since MOST PLAYERS will NOT be willing to give up the bandwidth that would be required to download a movie because their PLAYING GAMES means a very SMALL segment of the XBox Live demographic will be downloading movies to their Xboxes.

    Apple BTW has a trach record for media distribution. MS has a track record of huge loses and orphaned DRM schemes. Sounds like Hollywood has made a find chioce with MS! PLEASE!

  15. It’s weird that hardly any Apple-related blogs are covering this. When I first read the news, I assumed it would be all over the Apple sites today. A definite salvo against the iTV thing.

  16. Keep in mind, Apple was not the first company to come to market with an MP3 player. It was the first company to do it right. They might be able to pull the same thing off in the “iTV” market as well.

  17. I love how folks are comparing this to iTV when no one knows exactly what iTV will entail. What is also missing is the whole DRM issue. Microsoft’s DRM has sucked with no regard to end users, so unless I see some significant change in that area, the Xbox 360 option is a “pass”.

    Personally, as a non-gamer — I’m more interested in the Wii than Xbox 360 (or PS3). The machine is much cheaper, looks like it’s more fun and has some non-traditional games — all pluses.

    As for iTV, I’ll wait until it is actually available before I make any comparisons.

  18. @Percy

    The Xbox Live Gold subscription (US$59.99) is only required if you play online multiplayer. A Silver subscription is standard with every Xbox 360, and will let you do everything else, which will probably include the film renting/buying since it is most likely to be located within the Marketplace, which is open for everyone.

  19. The XBOX 360 can also stream standard and HD video from a Windows Media Center 2005 or Windows Vista PC. You can then use the MCE/XBOX360 combo as a DVR.

    Also, You can use Windows MCE or Windows Vista and an XBox to stream your itunes library from the PC to the XBox360.

    I’ve been doing all this for over 2 years now.. with my v1 XBox.

    XBox360 adds the possibility to stream HD tv from my PC that I recorded on the PC. And now it adds an ability to rent movies from my couch, and for some more $$$ I can play HD DVD’s.. (but who want’s to put content on discs anyway? Not me!)

    Oh, and you can play games on it if you want to..

    It’s a better combo.

    Also, there are new v2 extenders coming out that you can stream TV from the PC to the TV with. No game functions.

  20. hmmm, I smell the stink of desperation among the Apple community.

    As for me, this is great news. Just one more awesome feature for the new XBOX360, which is already a killer product.

  21. The real question is about the content, not the hardware/delivery method. Do you own the movies/shows when you use this new Xbox service? Or are you “renting” it. At least with iTV, you can use itunes to purchase your content and from there you can use it anyway you want. Watch shows/movies on your ipod or stream it using iTV. Seems more flexible to me than the xbox service…

  22. People seem to be ignoring that you need to actually own a Windows Media Center PC before you can gain access to *any* video streaming capabilities on the 360 (total con imho). Since this is the case you can factor in the additional Windows license and also the need for a wireless adapter before you have the same functionality as the iTV.

    In addition to this everyone seems to think that to stream an HD signal with any degree of reliability over that said wireless network will need to be using the next generation of wireless which the iTV supposedly contains but the XBOX currently lacks.

    Anyway, I’m sticking with my XBOX Media Center rig, it’s cheap and it works like a dream : P

  23. This article is true and interesting indeed. But you don’t discuss Apple’s biggest competitive feature of the iTv and what separates it from all other solutions. That feature is the ability to watch whatever is on the iTV from any room that has a mac on the network.

    Thanks for the article.

  24. From the article – “and if the Zune is integrated with the Xbox 360 it may even be a blow to the iPod in the long run.”

    After downloading the update for my 360 I was having a browse through the system to see what changes were made. I came across a greyed out menu that inferred that Zune inegration was already in place. I didn’t fully check it out, it’s not of much interest to me since i have no intention of buying a Zune. Just thougt I’d mention it.

  25. I’m not a big gamer, so getting this capability through the 360 is not that interesting to me. And, I’m not interested in downloading sub-DVD resolution movies through iTunes at a premium price either.

    However, I am interested in streaming the contents of my Mac to my TV, and controlling it from the TV. I have an Airport Express that I use all the time, and love it. The obvious downside being that I have to go in the room where my Mac is to change songs [yeah, I know, get a laptop]. What we know about iTV so far, resolves that, and a lot more. Is that worth $299? Maybe.

    What would make iTV a monster success for me, and probably in the marketplace, would be add-on hardware modules that would be networked and accessible by other iTV units in the house, and obviously Macs and PCs running iTunes. For example, an external hard drive that stacks under iTV. And, a digital TV tuner. Maybe a DVD player. This would give me multi-room DVR capability and placeshifting like a Slingbox, among other things.

  26. With the latest update to the dashboard the streaming on the xbox360 is awesome. I’m streaming all of my dvds from my pc to the 360 and it is working flawlessly. I really can’t wait until the store opens up and I can get movies in HD. This is a huge leap for Microsoft and I will definitely be renting my movies online now through them instead of netflix/blockbuster for less money and as a bonus it will be in HD!

  27. Actually the 360, from my experiences does a pretty decent job of streaming video from your media center pc to the 360. the problem is that it only streams wmv and mpeg video’s, if you have anything that is divx or xvid, it doesnt stream. however, there are a few programs that will allow you to stream divx and xvid. one such program is called transcoder360. you install that on your media center pc and it runs as a service on that pc.

    From your 360 when you launch the media center program to stream your videos, it will automatically encode and stream your divx and xvid to your 360 on the fly. works pretty well if your not using too much or your pc and networks resources at the same time.

    I know its not what a lot of people that will view this site will want to hear, but the 360 is a pretty decent console for streaming videos. the problem however with this story is that the 360, as of right now, only has a 20 gig harddrive, and once you ad in the fact that that harddrive is going to be used for game demo and video downloads, arcade game downloads, and game saves, 20 gig isnt hardly enough space for downloading movies and tv shows.


  28. While Microsoft’s on-demand service is interesting, all it does is movie rentals, and not movie purchases. Unless Microsoft somehow finds a way to get the TV shows and movies on and off the Xbox, PC, and Zune: they won’t be able to compete with Apple.

    The only reason the studios are going to the Xbox is that since it’s not on a computer, they assume it’s safer. It also probably has DRM, it’s not portable to anything else, and it’s essentially movie rentals.

    No wonder the studios are flocking to Microsoft’s platform. That’s what they’ve been waiting for.

  29. You see, XBox is for playing games. It does other stuff too, but it’s for playing games. At least in terms of customer’s perception. iTV is a TV device. It does one thing most likely well and (always most likely since we are talking about something that is not even out yet) will not require any special network setup.
    If you have a mac in your home that’s something that you’ll buy and it will be another piece that will integrate well in the apple platform.

    I don’t think it actually compares to the XBox anyway. The target is different. It might sound ridiculous but I think that who wants to watch movies and pictures on his/her TV set won’t buy a game console. It’s pretty much the same concept as mp3 players: the iPod does only one thing, fairly well, well integrated in the apple platform. It sells.

    I don’t understand people waiting for Apple to fall down and Microsoft conquering the last small percent of the market. I don’t understand the opposite argument either.
    It’s just about consumer electronics. Just a cheap (in production) piece of plastic that powers up and entertains you in different ways. It’s not rocket science, it doesn’t save lives, it doesn’t help the designers to get the Nobel prize and it doesn’t make the mankind go one single step forward. It’s just a device, who cares who makes it, if you like it you buy it, if your friend likes the other this doesn’t make him either smarter nor more stupid.

    Just my 2 cents.

    PS: I recently tried the RC2 of Vista for development purposes. It sucks. It’s the worst piece of crap I’ve ever seen especially if I think how long it took to make it and how many smart people work at Microsoft. If that OS picks up, it’ll bring the mankind back in the medioeval ages.

  30. First I own a Xbox 360 and I am a Xbox Live Gold subscriber. If you don’t have a Media Center PC the Xbox 360 is not a very good Media device. It got better with the last update but it’s still limited. You can’t stream video unless you have a Media Center PC.

    The Xbox Live marketplace however is a great way to get video. You don’t have to worry about sharing bandwidth during a game because the download will pause while playing games and resume as soon as the Xbox is idle again.

    In my opinion the Xbox has these advantages over the iTV device.
    1) HD content iTunes videos are currently lower then DVD quality. I’m not paying for that.
    2) It integrates with a Media Center PC. iTunes and iTV offer no PVR functionality out of the box. Unlike Steve Jobs I think this is important.
    3) Xbox 360 also plays games
    4) Free Xbox Live Silver account tracks friends, has voice and video chat, etc.. Right from you living room couch. I don’t think iTV will support iChat etc..

    I think the iTV would have been a great device 6 months ago with a built in PVR, but as it is my money is on the Xbox 360 and Media Center.

  31. Just a few quick things:

    1) You only need a Gold subscription to play multiplayer games and get “exclusive content” videos don’t fall under that category.

    2) We can’t play games ALL the time

    3) It’s here, it works, and it works nicely

    4) It has _content_

    5) Did I mention it is here?

  32. I just want to easily be able to rent movies cheaply. I don’t want to own every movie I watch thus I don’t want to pay as much as being thus far shown. Family Video is 6 blocks or rather 5 min from me. Walmart with their dvd collection and comparable prices is 2 min away.

    If I want to get rid of cable, I also need a way to stream my college basketball games live to me. That also means looking at season passes for many tv shows that my family watches. So much for cheap…it’s not.

    Sorry folks. This all sounds cool and all but it’s still going to be for those with money to burn. My 5th gen iPod on the other hand was well worth it and is proving to be a bargain for what I get out of it. Yes, I buy songs via itunes due to buying singles at a buck a pop and the convenience. Podcasts were the big seller though as I listen to them everyday. In my car I’ve not used the radio since last xmas just before I got the ipod.

    Looking at it overall I’m having a hard time thus far seeing where the value of iTV, xbox360, and others come in if the expectations are for it all to grow like the ipod and online music did. It seems to me that perhaps not being first might not be so bad afterall.

  33. Agreed, the gamer market in insular and ultimately very limited;

    MS is pursuing the gamer market as their toehold in the living room but for most consumers, it’s a non starter – not even on the radar.

    First to market with rentals that disappear 24 hours after you start to watch it … this is a hobbled offering. No wonder the studios think it’s safe – it is, but it won’t make them much money.

  34. You no longer have to have a media center pc to stream video to the 360. Since the last update that was pushed out at the end of october, you can now stream video from windows media player 11 and the zune when it comes out. It actually seems to work much better than the media center extender streaming does too.

  35. YOU DO NOT NEED MCE TO STREAM – install Windows Media Player 11 onto Windows XP and you have access to photos, music and mp3’s. Yes Microsoft listened to their Xbox users and provided support for streaming from normal XP boxes.

    All they need to do is add sspport for non-MS codecs such as DivX/Xvid and I can dump my ShowCenter and never need to look at iTV.

  36. GIVE ME A BREAK everyone…. I’m an Apple fanboy.. love them.. love their stuff… but come on… Comcast / Time Warner/ DirecTV/dish, etc.. have a lock already.. its called OnDemand.. no latent downloading, etc… Microsoft and Apple wont even make a dent… Comcast farts the number of total Xbox users every day…. And just wait until Comcast gets the movie industry to do zero-day OnDemand.. its over.. game set match.

  37. Tom –

    I don’t think there’s any real validity to the ideas presented in that post. Just my opinion, but Apple has no reason to enter the video game market, and I don’t see it happening any time soon.

  38. Apple does everything with such superior quality to Microsoft, so I’m not too worried about the iTVs.

    What I don’t realize, is why everyone fails to see Apple’s potential. If Apple really wants to deliver a deadly blow to the nether regions of Microsoft, why not compete with the XBox itself? Apple is innovative to such an extent that it could easily leap into the next (or current) generation of consoles, bringing such brilliant innovations that even the Wii looks weak by comparison. I’m sure the folks at Apple could put their creativity to such a use.

  39. Good question
    What I don’t realize, is why everyone fails to see Apple’s potential. If Apple really wants to deliver a deadly blow to the nether regions of Microsoft, why not compete with the XBox itself?

  40. have been visiting ur blog for three days. really enjoy what you posted. btw i’m doing a report relating to this issue. do you happen to know other websites or perhaps online forums in which I might get more information? thanks a lot.

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