Microsoft TV Returns via Rug-top Box with Live TV

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By Gary Arlen

Microsoft’s Xbox 360 will become the rug-top box receiver for a new live television service, making Microsoft a “virtual cable operator.”

At the Electronic Entertainment Expo (E3) videogaming conference in Los Angeles this week, Microsoft described plans for its new “Live Diamond” service - an extension of the Xbox Live function that has been available for several years. The Live TV service was overshadowed by other Xbox 360 announcements.

Mark Whitten, who heads the Xbox Live venture, did not announce the line-up of Live TV shows, but he indicated that Microsoft video partnerships would grow “by a factor of 10.” He focused on the program discovery and navigation features, which will let viewsers search for content on the Web, YouTube and existing broadband sources such as Netflix and Hulu Plus. A voice control function will help you search for a movie, TV show or game by saying the title.

About 32 million Xbox 360 “rug-top boxes” (albeit many actually rest on or near a TV monitor) reside in homes now; many are already hooked up to the built-in broadband connection. Xbox Live TV will include social TV features, allowing users to interact (chat or other functions) with friends who are watching the same show.

Microsoft has been auditioning for TV roles for more than a decade, including its billion-dollar investment in Comcast, which generated no discernable results (other than a big cash input and digital learning curve for Comcast), and the $450 million purchase of WebTV.

The planned Xbox Live TV initiative, due to debut in autumn, marks a big leap from other TV content deals that Microsoft has attempted. A year ago this week, ESPN said that it would offer up to 3,500 live sports events annually available via the Xbox 360. Some of those shows have been available through the service via the Xbox Live Gold service.