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Living with the Xbox 360: how Microsoft's trojan horse took over your living room

ecosystems msft deep dive

It seems like every new week brings rumors and news of tech titans trying to capture the living room, the heart of the American household: Apple in talks with cable operators, Google building its own streaming media box, TV and movies overtaking games as the primary way people use their Xbox. It’s all part of an ongoing battle for the future of the television, which despite the rise of the internet and the explosion of mobile technology, still captures the lion’s share of our viewing hours. And like every battle, the key to understanding it is understanding the players: their strengths, their weaknesses, and their strategies.

So we tasked a number of Verge writers to each live only within a single media ecosystem: Apple, Google, Microsoft, Amazon, Sony, and the various independents. All this week, we’ll be publishing an in-depth take on each company’s media offerings. We’ll start today with Microsoft and Google, then Amazon and Sony, Apple, and finally the indies like Boxee and Roku.

Intro

Microsoft may be the tech industry’s most dramatic story of 2012. The company has been in a constant state of flux / transition / reinvention / evolution (the proper descriptor depends on whom you ask) and all the fruits of all its labors seemed to have been realized within the span of about two weeks starting late October: an overhauled Windows with a heavy focus on touch-friendly interaction. A first-party flagship tablet (Surface). The departure of the man most responsible for these two projects. A rebooted Windows Phone platform with a trio of major OEMs. A music subscription service poised to take on both Spotify and iTunes. A brand new Halo title spearheaded by a newly-minted, in-house developer.

Yet for all its change this year, there has been one constant: the Xbox 360. Microsoft’s set-top box (née gaming console) launched in 2005 and has served as an anchor for the company’s "big screen" plans ever since. Microsoft has been evolving the "Xbox" brand from something focused on gaming to all entertainment and media content. For many, the console was their first foray into Netflix on TV, and the company has gradually made it a centerpiece of the Microsoft universe.

Movies and Apps

Microsoft has added an impressive number of entertainment apps and services to the Xbox 360 — dozens in the US alone, with many more worldwide (like Sky Player and BBC iPlayer). The categories range from subscription-based (Netflix, Hulu), to channel-specific (ESPN, HBO Go), operator-specific (Comcast TV, Verizon FiOS) — and even on-demand services that compete directly with Microsoft’s own Xbox Video Store (Vudu, CinemaNow).

Bing

What makes that list even more impressive is how Microsoft has tied them all together. The Xbox 360’s universal search (branded as Bing, of course) gives equal weight to all its first and third-party services, so if you’re searching for something specific, Bing will tell you exactly what service you can get it from and push you directly to the app.

If it’s available online somewhere, there’s a good chance you can stream it

Search "Avengers", for example, and you’ll find the the 2012 film is available via CinemaNow, VUDU, and Xbox Video itself. You’ll also find the 1998 British spy remake starring Uma Thurman (Comcast Xfinity, Xbox Video, VUDU, CinemaNow), a 2010 animated series that ran two seasons (Xbox Video, Netflix), and even the movie tie-in Xbox game Avengers: Battle for Earth (plus some random songs that happen to have "Avengers" in the title.) Convenient at times, you can also filter results by type (Music, TV shows, Movies, Games, Apps) when needed. Searching for a TV show brings up the entire series and lets you drill down by season and episode. We were honestly scratching our heads to find something that wouldn’t appear in search results — point is, if it’s (legally) available online somewhere, there’s a good chance you can stream it on Xbox 360.

The results can require sifting and don’t always rank as you’d hope, especially with TV. "Downton Abbey", for example, yields five TV results: Downton Abbey (which itself seems to be a hodgepodge of episodes from Series 1 and 3 — mostly VUDU but also some Netflix), three different Masterpiece: Downton Abbey results (one exclusive to Xbox Video, one to Amazon Instant video, and one exclusive to Hulu Plus), and the 2012 miniseries Titanic (unrelated to James Cameron blockbuster).

There is one service that does not show up in search results, and it’s an important one: Amazon Instant Video. Though Amazon's streaming library is available as an Xbox 360 app, the content won't appear in Bing's search results. That media also can’t be purchased via the console — you’ll have to go to Amazon.com directly and then hop into its Xbox 360 app to see your purchases. The upside of the hassle is competitive prices — in some instances, it was cheaper to use Amazon than anything Microsoft offered.

Live TV

This is the part where I confess I am a cord cutter. Apps like HBO Go and ESPN require that you need to subscribe to these channels the traditional way (via cable or satellite) before you can get access on Xbox 360. Thankfully I was able to test at other houses and can definitely say the ESPN app streams live in HD.

The other outlet is a subscription or pay-per-view model, especially for sports: MLB.tv, NBA Live, and UFC will all let you pay directly and watch live events without the need for cable or satellite — but of course, it’s quite costly.

Xbox Live Gold

Don’t even bother lying to yourself: an Xbox Live Gold subscription (around $60 per year — more on that later) is pretty much required if you’re going to do anything with your console beyond offline gaming (although, to be fair, there are many hours of joy to be had playing Skyrim alone). Microsoft does offer a free tier, aptly titled "Xbox Live Free," but its functionality is mostly limited to purchasing downloadable content and video content from the first-party Xbox Video store. Users with a Gold membership can play games online, save game content to the cloud, and, most importantly, use all of Xbox’s apps — even those that you’re already paying a separate fee to use.

That last part is key. Even if you’re paying a monthly subscription to services like Netflix / Hulu / Amazon Instant Video, Microsoft is still charging you just to watch it on the Xbox 360. It’s definitely a pain point given competing boxes like Apple TV, Roku, and PlayStation 3 do not charge similarly.

Interface

Xbox-music

Though the platform has remained largely unchanged — if you bought an Xbox 360 on launch day, it’s just as capable as one you buy today — Microsoft has consistently tweaked both the hardware and software. Since its 2005 debut, the company has maintained a schedule of fall and spring updates that offer new features and the occasional visual refresh.

If you bought an Xbox 360 on launch day, it’s just as capable as one you buy today

In the latest update to the Xbox 360 interface (known as Dashboard), Microsoft made a few tweaks to put the UI more in line with the tile-based design language now so prominent in Windows 8 and Windows Phone 8. At face value, it should be a quick enough interface — eight top-level categories (Bing, home, social, games, tv & movie, music, apps, settings) each having up to 12 tiles for quick access to content. Unfortunately, Microsoft prioritizes advertisements over content — both for items available on Xbox Live and even sometimes out of network — meaning many of the apps you want to use will involve drilling down to another submenu. You can "pin" select apps for easier access, but counterintuitively, all the pins reside in a submenu accessible from the "home" tab.

Kinect Voice

Xbox-hello

Thankfully navigation by way of gamepad has been increasingly de-emphasized over the years. I’d argue Kinect Voice was the first big improvement. (Using hand waving / hand hovering to go through the menu isn’t worth mentioning beyond this parenthetical.) From the top menu, it’s just a matter of yelling "Xbox" and talking aloud the menu option.

"Xbox Stop! Stop! Xbox Stop! Dammit Xbox Pause! Stop! There we go."

It isn’t perfect, however. Kinect Voice search isn’t available within apps, as far as I could find, and the universal Bing search (whose nuances I discussed above) requires you to back out of whatever app you might want to search from. Alternatively, you can stay in the app and type via the Xbox 360 controller (a huge hassle) or use SmartGlass (more on that soon).

Even with calibration, my success rate for Kinect Voice hearing me is about 50 percent when there’s video playing. I don’t know what my neighbors do all day besides yelling "Xbox Stop! Stop! Xbox Stop! Dammit Xbox Pause! Stop! There we go." I don’t want to paint the experience in a bad light, though, because at the end of the day, I use Kinect Voice more or less exclusively when I want to watch video.

SmartGlass

Xboxsmartglass_640

Microsoft’s latest initiative this year, SmartGlass, lets you do most any menu function on the TV screen using your mobile device. This "second screen" tech is available on on iPhone, iPad, Android, Windows Phone, and Windows 8. While watching a movie or playing a game, you (or someone else with access to your account / device of choice) can navigate the menu system, search for content, and then send to the Xbox 360. It can also serve as rudimentary remote for basic functions — the left joystick is mapped out across blank space while the A / B / X / Y and guide buttons are logically placed around the screen.

That’s one use of the SmartGlass, and in practice it’s a pretty good one on its own — especially universal search, which is subsequently available at any time and allows for more convenient input by way of your second device’s keyboard. Microsoft’s other big pitch? The SmartGlass app lets you control supplementary content: for Dance Central 3, it’s loading up the playlist. For Halo 4, it’s stat tracking. Certain movies (about 37 at time of writing, including 2012’s The Avengers) use the functionality, too — providing the same kind of data you’d normally get from IMDb. Microsoft is touting that content makers can code once and it’ll work across all devices, and the functionality is likely to expand greatly as time goes on.

Internet Explorer

Microsoft’s other big update to Xbox 360 this year was the addition of Internet Explorer — and I mention it in "interface" because having SmartGlass is more or less a requirement to make this work. The touchscreen device serves as a makeshift mouse, search is done via the keyboard, and... it’s still hard to recommend. Few sites render properly, Flash is not available, and while it’s fun as a novelty at times, it’s not about to replace your laptop anytime soon.

Gaming

Xbox-gaming-560

But entertainment is only half the story — literally. Microsoft likes to say that about 40 percent of all Xbox activity is "non-game" use. But the Xbox 360 launched as a gaming console, and that’s still its primary raison d’etre — it’s arguably the house that Halo built over a decade ago.

Nearly seven years old, the system has a sizable number of top-tier titles and is still strongly supported by both Microsoft and third-party titles (launching this holiday season: multiplatform games like Assassin’s Creed 3 and Call of Duty: Black Ops II as well as exclusives like Dance Central 3 and the destined-to-be-blockbuster Halo 4). There are very few platforms relevant in home console gaming, and the Xbox 360 is well established that market.

Cost

Like I said, Xbox Live Gold is pretty much a requirement — to use the Microsoft ecosystem, you’re gonna have to pay not only up front for hardware but also pay for monthly use.

You’re paying not only up front for hardware but also for monthly use

An Xbox Live Gold membership ranges from $59.99 for a full year to $9.99 a month (which amounts to $119.88 annually) if you’re feeling less committal. While you can upgrade your membership directly from the Xbox 360 interface, there are often discounts offered by third-party vendors — Amazon.com, for example, right now offers an instant-use online game code for 12 months of Gold at 18 percent off.

As for the console itself — your only real option to get full access to Microsoft’s ecosystem — the current model costs $199.99 for the base model (4GB storage) or $299.99 to include either a larger 250GB HDD or a Kinect sensor. On top of that, there are special edition bundles that’ll include more games, more accessories, and oftentimes a custom paint job (the most recent examples being Halo 4 and a Star Wars themed console).

That’s a pretty steep cost of entry (hardware and annual subscription) if your sole interest is for playing video, but Microsoft does have an interesting alternative business model. Taking a page from the US mobile phone industry, you can get a new Xbox 360 4GB + Kinect for as low as $99... provided you also agree to a two-year Xbox Live Gold subscription billed at $14.99 per month. Doing the math, that comes out to $458.76 on contract versus $419.97 off contract (a $299.99 Xbox 360 4GB + Kinect and two years of Xbox Live Gold at the full, $59.99 price tag).

Wrap-up

The Xbox 360’s roots are in gaming — that is to say, interactive entertainment. Microsoft has smartly experimented with new ways of interfacing with the big screen beyond the simple gamepad and remote. Kinect, SmartGlass, and Bing’s universal search are three powerful advantages (to say nothing of its extensive top-tier gaming library) as is its library of not only video but of third-party services that fill in gaps and offer other business models.

If you can stomach having to pay a subscription fee on top of your Netflix / Hulu / Amazon fees, there’s quite a bit to love here.

Explore the ecosystems

This week we're taking a close look at the future of TV and the living room — the great unclaimed space of the technology world. Check back each day for a close look at all the major players, along with a full range of interviews with industry players and reports on everything from the state of remote controls to the future of gaming. Tune in all week for the rest. Here’s a sampling:

Tuesday:
Google, Microsoft, Aereo, Boxee CEO Avner Ronen
Wednesday: Amazon, Sony, live sports, TV apps, Condé Nast’s Dawn Ostroff, NBC's Vivian Schiller
Thursday: Apple, the state of remotes, Vizio CTO Matt McRae
Friday: Independents, New Yorker's Emily Nussbaum, Valve

The Verge
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