Tuesday, March 21, 2006

Microsoft's Plans For Handheld Game Player And "iPod Killer"

Not technically Origami news but interesting to see where Microsoft may be headed next:

In a bid to capture the huge audience for handheld entertainment gadgets, Microsoft is designing a product that combines video games, music and video in one handheld device, according to sources familiar with the project.

The Microsoft product would compete with Sony, Nintendo and Apple Computer's products, including the iPod. And Microsoft has some of its most seasoned talent from the division that created its popular Xbox 360 working on it. Game executive J Allard leads the project, and its director is Greg Gibson, who was the system designer on the Xbox 360 video game console. Bryan Lee, the finance chief on the Xbox business, is leading the business side of the project.

By anchoring its entertainment device as a handheld game player, Microsoft is starting from its position of strength in the entertainment business that it hopes Apple cannot match, even with its iPod. The game press has dubbed it an "iPod killer,'' but its functions would likely more closely resemble Sony's PlayStation Portable multimedia gaming device.

While details are sketchy, the pedigree of the people in charge of the business show how strategic it is to Microsoft's future.

"That would certainly be an interesting development in the market,'' said Anita Frazier, a game industry analyst at the NPD Group.

In the past, all of Microsoft's efforts to compete have fallen short. The company considered making an ""Xboy'' game player a few years ago but shelved the idea. It considered making a game handheld at the same time it devised plans for the Xbox 360 in 2002 and 2003, but it again decided to delay its entry.

Meanwhile, Microsoft's efforts in PocketPC handhelds and Portable Media Players have fallen short in competition with the iPod. Last week, Microsoft unveiled Project Origami, a handheld Windows computer. But that device isn't targeted on pure entertainment as the Xplayer is. The existence of these other projects suggests that there is still some infighting within Microsoft about its best approach to portable gadgets.

The handheld project is still in its early stages. Microsoft is still figuring out which strategy to pursue in music technology, according to sources familiar with the matter. The code name for its music service, which would be the equivalent of Apple's iTunes, is "Alexandria.''

One benefit of waiting longer is that the handheld will likely have sufficient technology in it to run a lot of original Xbox games from a few years ago. Hence, it wouldn't be hard to create a new library of games for the handheld.

Signs of activity have surfaced. Transmeta, a maker of low-power chip technology, said last year that it had assigned 30 engineers to work with Microsoft on a secret project. Transmeta's engineers work on ways to take the power out of computing chips so that they can be used in handheld devices with long battery lives.


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