Xbox And Kinect Are The Future Of TV

Xbox And Kinect Are The Future Of TV...
Except Microsoft Will Figure Out A Way To Blow It

Xbox 360 and its slick new motion-sensing Kinect gadget could very well represent the future of how people watch TV: Zipping from channel to channel, or from app to app, without a remote control, using their hands and voice to control the experience. Microsoft's history of failures in the television industry -- and the overall slowness, messiness, and complexity of the TV business -- the odds of Microsoft succeeding here, and truly taking over, are slim.

Last month, we had a chance to experience some of the new Xbox and Kinect entertainment apps at a Microsoft briefing in New York. (Kinect support is coming soon to the Xbox's Netflix and Hulu Plus apps, Microsoft just announced.) And we were really impressed.

The idea of being able to ditch your table full of remote controls and just use your hands and voice to interact with the TV is compelling. It's much nicer than QWERTY keyboards -- a terrible idea in the living room; Wii-like remote controls; or even using an iPad or smartphone as your TV remote.

Microsoft seems way ahead here, and we're actually surprised that Apple -- which has been sticking a camera in all of its computers for a while now -- isn't the one who has led the way here. The Apple TV gadget should be powered by gestures, not a dinky little remote control. (Perhaps they're saving this for their TV sets?)

So it's good news for Microsoft that Kinect, and all the high-quality entertainment apps on the Xbox 360, are looking more and more like the future of the living room. And it's nice that Microsoft owns the intellectual property, especially through its recent acquisition of Canesta, which has filed for more than 50 patents.

But it's hard to imagine how Microsoft could come to dominate the TV business.
For Xbox TV (we'll call it that for now) and Kinect to really make a huge mark, they're going to have to be everywhere, the way Microsoft Windows is for the PC industry.
But it's not like everyone is going to buy an Xbox 360 and Kinect. While Microsoft has sold tens of millions of Xboxes already, and has shipped 8 million Kinects, it's not practical to assume that everyone is going to buy one -- they're still too gaming focused and too expensive.

So, what are Microsoft's options?

• It could slap together an "Xbox TV" gadget to rival the Apple TV, which just includes the Xbox's entertainment apps and the Kinect interface, and no DVD drive.

• It could try making actual Xbox television sets and hope to disrupt the TV industry incumbents, the way we expect Apple to.

• It could license the Xbox TV and Kinect software to TV, Blu-ray, and cable set-top box makers, and go for the "Windows" model, competing with Google TV. Maybe it could team up with Facebook for this one.

The thing is, while each of these is somewhat possible, we don't see Microsoft rushing to do any of them. It seems like they're too addicted to the Xbox's substantial gaming revenue to split the Xbox TV stuff off, even though there's a huge population of non-gamers who probably have no interest in buying an Xbox.

Instead, we see Microsoft more or less leaving the Xbox 360 intact, and trying to address the living room (again) with some kind of embedded Windows -- which doesn't have the Xbox's cool entertainment apps or the Kinect controller. And that, like Microsoft's other TV projects to date, will probably be a failure.

So while the Xbox and Kinect are really cool, and could actually be compelling TV experiences, we're not expecting Microsoft to truly capitalize on them. And instead, they'll let the likes of Apple, Google, Samsung, and Cisco run away with the future of TV