msft

Microsoft Corp.'s (NASDAQ:MSFT) venerable Xbox Live service, which I've used before and found highly entertaining and very solid for an online gaming service, is getting beefed up in a huge way by Microsoft. The world's largest software maker is trying to get entrenched as best it can into the entire consumer entertainment arena -- centering around the living-room TV and sound system -- before rivals like the Apple Computer, Inc. (NASDAQ:AAPL) iTV get there.

Although technical details aren't available, from what I could find, the new Xbox Live features will include both high-definition and standard-definition content. With all that content being pushed down to millions of Xboxes, there's going to be some data bandwidth crunch. This is an area where I agree very much with Mr. Blog Maverick. The datapipes are going to have some stress issues once all this video content starts getting pumped en masse to millions.

Xbox Live users will actually "own" the TV shows they purchase through the service, while movies downloaded through Xbox Live will be "rented" for a period of two weeks. Initially, television shows and movies from CBS, MTV Networks, Paramount, Turner, UFC and Warner Brothers will be available, with more studios and content providers being added later.

Will customers bite? This looks very promising, and if the success of Xbox Live continues into this new uncharted territory for Microsoft, the company may have a winner of sorts on its hands.

[Disclosure: I own MSFT shares as of 11-7-06]