That beefed-up price tag--which also applies to games for Microsoft 's Xbox 360--is a 20% increase over games for earlier consoles.
But games are just too strategically important to the company--Microsoft estimates that 50% of home software purchases are games--to leave to the vagaries of signing good partners.
And after the original Xbox flopped in Japan, Microsoft has wooed Japanese games-publishers, hoping to counter the advantage enjoyed by its two main rivals.
Ballmer talked of the revolutionary implications of a world, perhaps five years away, where all media is delivered via Internet protocol, and said Microsoft would be everywhere--games, search, operating systems, hardware--to capture that.
Instead of developing games in-house, Microsoft prefers to hook up with small companies based on early versions of their games or the reputations of their designers.
Throughout most of the year, earlier installments of the game held between two and three slots on the top five most-played games list on Microsoft's Xbox Live online game service, according to Microsoft.
This is hardly his obituary, and perhaps freeing himself from the obligation of making half-hearted Kinect games for Microsoft will allow him to get back to his roots and breathe life into more unique titles.
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He is staying plenty busy pressing Microsoft beyond PCs into television set-top boxes, games, cell phones.
And some game developers are working on techniques to show their games in 3-D on Microsoft's Xbox 360 device and on PCs.
It has Sony 's PlayStation 3 on the ropes in the United States, and among today's generation of 20-somethings, Microsoft is better known for blockbuster games like "Halo 3" and "Gears of War" than its bruising late 1990s anti-trust case.
It has Sony 's (nyse: SNE - news - people ) PlayStation 3 on the ropes in the United States, and among today's generation of 20-somethings, Microsoft is better known for blockbuster games like "Halo 3" and "Gears of War" than its bruising late 1990s anti-trust case.
From its line-up of casual games and demonstrations, Microsoft clearly intends to expand beyond its hardcore segment of gamers into a broader audience that includes families.
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At the recent CES conference, Microsoft showed off a proof-of-concept video that expands games beyond the television screen.
With the sole exception being its Flight Simulator franchise, Microsoft is aware that it hasn't made great games in-house.
Microsoft first announced that it had entered a 3-year exclusive partnership with games-maker Activision Monday at its press conference during E3 in Los Angeles.
For the first time ever, Microsoft is reporting more time spent on non-game apps than time spent playing games while connected to Xbox Live.
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Microsoft expects to offer more than 1, 000 apps and games by mid-November and to add several hundred each week for the remainder of the year.
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Microsoft is really going to have to think long and hard about whether an anti-used games measure would be in their best interest.
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If Microsoft wants to deal a serious blow to its only major competitor in the high-end games console space, it should use some of that corporate weight to drop the price on the next Xbox and make its next console the only logical buy.
The PS3 has been outsold by Microsoft's Xbox 360 for 20 months running in the US - the world's biggest games market, according to data from NPD.
On the Microsoft stand there were two-hour queues to play Blue Dragon and Lost Odyssey, the latest role playing games.
"If you want 3-D, 3-D games are available today on Xbox 360 and will continue to evolve, " a Microsoft spokesman said in a statement.
You can take money out of these tax-favored accounts to buy any computer, peripheral, or educational software but not games (Microsoft Word, for example, but not Halo).
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As video game blog Kotaku reported back in November, Microsoft and Nintendo have rolled out new ecologically friendly cases for games found on their Nintendo Wii and X-Box 360 consoles.
Meanwhile, in console-land we have three current-gen systems with a huge catalog of really good games, the upcoming Wii U, and the next-gen offerings by Sony and Microsoft coming next year.
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In the long-term Microsoft hopes it will generate revenue from the service, with gamers spending money on improving features in games and up to date statistics for sports games.
Sony is going to have a laserlike focus on games this time around, while Microsoft wants to create a device that everyone, gamers and non-gamers alike, will want to have in their living rooms.
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According to the same article, it is claimed that Microsoft has decided to do the same as Sony and include an optical drive as part of its next-generation games console, widely expected to be called the Xbox 720.
Well, I say games they are more like interactive television and branded as 2-Way-TV by Microsoft.
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