Heating Up: Xbox 2, PS3, N-Rev: Latest!

Analysis: New report suggests Xbox 2 strategy will mirror Sony's planned dual-launch of both 'standard' and 'hyper' versions of PS3, while Revolution unveiling is confirmed.

The latest development in the next generation race has emerged, with Microsoft reportedly looking into the possibility of a simultaneous launch of a 'Standard Xbox 2' and 'Hyper Xbox 2' - mirroring Sony's planned dual-model PlayStation 3 strategy.

Artist's impression of PlayStation 3, which may see dual release.

According to a report on CNN/Money, Microsoft is considering the release of a beefed up Xbox 2 that would be compatible with both existing Xbox and PC games, at a not unreasonable price point of around $599.

The machine, known internally as Xbox Next PC, would also include a scaled down version of Windows, a CD burner, DVD player, built-in access to Xbox Live, and a hard drive, along with a keyboard, mouse and standard Xbox 2 controller. The unit would probably require a PC monitor or high definition TV for maximum quality, although it's perfectly feasible it would support a lower resolution mode for regular TVs.

Xbox 2: Two versions possible, just like PS3

The news that Microsoft is considering this route, using market research company B/R/S Group, comes as little surprise. Not only has Microsoft gone on record that it is bringing Windows and Xbox closer together with March's GDC unveiling of the XNA development platform, but it's no secret that the real next-gen battle between Microsoft and Sony is bigger than games, it's the battle for the living room - and who gets its box under your TV fastest. Gaming is just one component of that strategy, albeit a major component.

PSX's slow uptake in Japan proves the "living room market" is tough - but the unit is a mere test platform for PS3.

Furthermore, if the Xbox Next PC is an additional model that co-exists with the regular Xbox 2 (which is highly likely to be he case if the PC version does see a release) then the strategy almost exactly mirrors Sony's planned dual release of "Regular PS3" and "Hyper PS3" as detailed in this huge news from last month.

Both Sony and Microsoft are approaching the next generation of gaming hardware in a very sophisticated way that expands their entertainment strategies in the natural direction while not abandoning the core gaming customers they have won so far.

Microsoft's Xbox Media Center can support games too, potentially rivalling PSP and DS after all, reports MCV today.

Peter Moore told CNN/Money at E3: "We would be remiss if we didn't look at consumer scenarios that take advantage of our strengths but this is one amongst many, many other consumer scenarios that we're looking at... If you put two and two together, there's no doubt there's a great opportunity to put the two platforms together."

And perhaps most tellingly, he hinted: "There will come a day - in the not too distant future - that PC games will be interchangeable between Windows and the Xbox." And, prompted for more information on a release date, the expectation of a 2005 launch was strengthened when Moore said "Xbox has got so much going for it as we go into the holidays that anything that disturbs the ecosystem for us is bad for business."

If Microsoft wins the living room battle, Sony as a corporation could find itself in trouble, as the PlayStation business is the most profitable part of the organisation.

Iwata to unveil Nintendo Revolution at E3 2005