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Friday, April 18, 2014

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  • Xbox One: Very Pretty Face, But No Fundamental TV Disruption

    Yesterday Microsoft introduced its long-awaited new Xbox console, dubbed "Xbox One" and positioned as a "the ultimate all-in-one home entertainment system."

    Watching company executives demo Xbox One, it was immediately apparent how slick the device's gesture and voice controls are, particularly for navigating live TV and other features. For many buyers, these - along with Xbox One's gaming-related advances will be very compelling.

    But for those looking for a living room device that supports their on-demand oriented viewing, interest in niche specialized programming, affinity toward mobile interfaces/apps, or all of the above, Xbox One doesn't appear to break any new ground. In this sense, Xbox One is less about being a disruptor of today's TV ecosystem than about improving its use.

    In this vein, 3 things stood out to me: 1) "One Guide," an elegant new voice-controlled guide for what's on TV, 2) on-screen Skype while watching TV and 3) interactive sidebars that can present fantasy sports updates during the game itself. Importantly, the demo showed lightning-fast channel changing and even changing between live TV and games or other content. All of these are neat enhancements to the traditional live TV experience.

    However, all of these features require subscribing to pay-TV and using an HDMI pass-through and it's not yet clear which operators are supporters. That raises the real likelihood that Xbox One buyers could bring one home and not have it work as expected.

    What's missing from Xbox One is the ability to control on-demand and DVR content. No doubt live TV still dominates, but with DVRs now in 50% of U.S. homes and on-demand's acceptance growing, access to neither by Xbox One means at a minimum users have to manually switch inputs and remote controls - even though avoiding both is something Xbox One explicitly highlights as a benefit. This means Xbox One buyers would still rely on clunky pay-TV VOD and DVR UIs. In this respect, my 5 year-old Logitech Harmony remote, which gives me access to VOD and DVR features, is more advanced than Xbox One.

    From a programming perspective, while Xbox LIVE offers access to online-only options like Netflix, Hulu Plus, Crackle, Amazon, YouTube, HBO Go and others, Xbox One does not appear to extend support to the wide range video choices now available online or in mobile. So for those that value wider choices in niche programming or want to quit pay-TV altogether, a Roku, which has over 700 different content sources/apps, would be a better option.

    Finally there's the issue of mobile integration/second-screening. Mobile has been an Achilles' heel for Microsoft, and so not surprisingly, it wasn't mentioned (see comments below) during the Xbox One presentation. While Xbox One's voice and gesture controls are cutting edge, it ignores mobile devices' role as a next-gen remote control, discovery platform or as an interactive/social complement to TV. In this sense, Xbox One reinforces the TV experience as being siloed from other devices, something I believe many consumers are hungry to see resolved (and why I believe Apple has a big opportunity in TV).

    In sum, Xbox One is a very attractive new device for gamers and for viewers whose TV experiences are still mainly focused on live. But for those that are more focused on on-demand, niche online programming or integration with their mobile devices, Xbox One doesn't appear to offer disruptive new features, at least for now.

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