Microsoft has said it will spend half-a-billion dollars marketing its videogame console, the Xbox, as it challenges consumer electronic giants Sony and Nintendo in the $8bn market this year.
As the software giant unleashes Xbox on gamers across North America, it claims that its more robust game console, with its DVD player, a strong roster of titles, three processors, a built-in hard disk and a high-speed Ethernet port, is three times more powerful than any other gaming console.
The Xbox features a 233MHz, Nvidia-made graphics processing unit, the Xbox media communications processor, a custom-designed Intel 733MHz CPU, 64MB of total memory, and 256 audio channels.
Microsoft expects to make and sell 1.5 million consoles by the end of the year but has warned that, because of consumer demand, it expects the Xbox to be in short supply.
The company will release the Xbox in Japan on 22 February and in Europe on 14 March.
Instat analyst Brian O'Rourke said that Xbox would do alright, but believed it would take Microsoft a while to get its bearings and enough titles to be successful.
O'Rourke explained that Sony and Microsoft have the backing of third party software developers like Electronic Arts and Activision.
Nintendo, he said, does much of its own software development, but has some major third party support as well.
"Sony is the dominant player and is well entrenched in the hardcore and casual gamers' community, and at some point Microsoft will have to prise out Sony's base or find a way to increase the base to buy the consoles," O'Rourke said.
He added that Nintendo has a launch soon for its GameCube and has been in the market longer than anyone. "Nintendo has a solid core pre-teen and teen market and has been very successful," he said.
According to research from InStat, worldwide videogame console shipments totalled over $4.5bn in revenue, and despite this year's decline, unit shipments should increase substantially between 2000 and 2005.
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