Entertainment Industry

Category: Xbox

Microsoft: New music service on Xbox Live?

Zune Pass

Microsoft Corp. is reportedly rehearsing for the launch of a new digital music service for its Xbox Live platform and elsewhere that could be announced at E3, set to take place in Los Angeles in June. 

The possibility, first reported in The Verge, would replace the Zune Music Pass service that Microsoft currently offers in favor of a more versatile service that would be available on more devices and platforms, including Facebook.

A Microsoft spokesman did not immediately reply to a request for comment. 

Microsoft has worked hard in recent years to beef up Xbox Live, an online entertainment marketplace accessable via the Xbox 360 game console. The Redmond, Wash., technology giant has been adding movies, television shows and live sports events via agreements with Netflix, Comcast, ESPN and others.

But music has also quietly gained momentum on the platform. Earlier this week, the company forged a deal with Epitaph Records to stream an upcoming album from a Los Angeles punk band, Pennywise. Microsoft also offers Last.fm on Xbox Live.

Last month the Microsoft said that for the first time since the Xbox 360 launched in 2005, time spent watching videos and listening to music on Xbox Live eclipsed the amount spent playing online games. More than 20 million people pay for the premium Xbox Live service, out of more than 66 million Xbox 360 consoles sold.


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Screenshot of Zune Pass music subscription service courtesy of Microsoft.

— Alex Pham



Changing TV habits center stage at digital media presentation

Lloyd Braun

NEW YORK -- The prime-time television ratings drop took center stage at the Digital Content NewFront presentations in New York, with former ABC Entertainment Chairman Lloyd Braun seizing on the numbers as an opportunity to talk about changing viewing habits -- and the rise of digital media.

In an onstage conversation with MediaLink Chairman and digital guru Michael E. Kassan, introductions had barely been concluded before the topic was broached: The four broadcast networks have lost viewers in recent weeks. And, unlike in years past, audiences aren't gravitating to the cable networks.

Braun, who joined the world of digital media after being forced out in 2004 as the top programming executive at ABC, referred to a trend reported in the New York Times as evidence that viewers are moving away from watching television shows live, when they initially air. Viewers increasingly are using online services, such as Netflix Inc., to get caught up on past seasons of award-winning shows, such as the PBS series "Downton Abbey" or AMC's "Mad Men," and watch current episodes through digital on-demand offerings, he said.

"There is no reason anymore -- for most of this kind of programming -- to watch it live," Braun told a group of advertising buyers attending Microsoft Corp.'s digital advertising presentation Tuesday. 

The trend has been on the horizon for years, Braun noted, adding with obvious frustration that advertisers continue to pay higher rates to air commercials during prime-time TV, despite the gradual erosion of the audience. He said he expects the trend to continue, as buyers attend next month's presentations by the major networks of new fall shows and commit billions of advertising dollars for the upcoming season.

This year's ad sales season, known as the upfront market, is expected to raise nearly $9.2 billion in commitments from advertisers.

"What I think has been driving people crazy on the digital side, we've all seen these charts which show time spent on the Internet versus where the [ad] spend is going," said Braun, co-founder of BermanBraun, an independent media company that develops television, feature film and digital programs. "There's this huge gap where the audience is spending time online and with tablets and smartphones, and the ad dollars are not commensurate with that."

The desire to grab advertisers' attention -- and dollars -- is behind the Digital Content NewFronts, during which five major online distributors will highlight their new shows for buyers.

Microsoft brought out some star power -- including U.S. Olympic gymnast and gold medalist Dominique Dawes, now a Fox Sports analyst, actress Felicia Day of "The Guild" and Kate Snow, NBC News correspondent with "Rock Center With Brian Williams" -- to promote the content available through its MSN portal and through the Xbox Live service offered via its game console.

Ross Honey, Xbox Live general manager of entertainment and advertising, sought to portray the Xbox 360 as a broad-based home entertainment device that offers more than video game play. It has struck some 50 content deals in recent months, including agreements with cable giant Comcast Corp. and Time Warner Inc.'s premium cable network, HBO, that offer subscribers access to TV shows via the game console.

The Xbox Live service has grown 30% in the last year to 40 million members, Honey said. Indeed, Xbox 360 consoles outsold other individual devices that connect the TV to the Internet, including Blu-ray disc players.

Entertainment usage on the Xbox Live has more than doubled, year over year, Honey said.

"In the U.S., entertainment usage has surpassed multiplayer gaming on Xbox Live," Honey said, referring to the video game industry term for players who connect via the Internet to oppose one another. "That's a profound event. When Xbox Live started 10 years ago, what it was all about was mutliplayer gaming. Now, Xbox Live really is an all-in-one entertainment platform."


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-- Dawn C. Chmielewski

Photo:  Lloyd Braun. Credit: Yahoo

Xbox now used more for online entertainment than online gaming

HBO Go on Xbox Live

In a significant milestone for a device once known only for blasting "Halo" opponents, Microsoft's Xbox 360 video game console is now used more for watching movies and TV shows and listening to music online than playing video games online.

Microsoft has long attempted to use the Xbox 360 and its predescessor, the original Xbox, as a "trojan horse" that would use video games as a way to become the digital entertainment hub for families in the living room.

"The original vision for the Xbox was for it to be the heart of connected digital entertainment and it has been amazing to watch the arc," said Otto Berkes, a senior vice president of consumer technology at HBO who helped to launch the Xbox at Microsoft.

Yusuf Mehdi, who heads up marketing and strategy for Microsoft's Xbox business, said households now spend an average of 84 hours a month on the Xbox Live online service playing games, watching videos and listening to music. That's up 30% from a year ago. Just over half that time is spent on videos and music.

By comparison, the average household spend about 150 hours a month watching television.

"What we're seeing is that people are turning on the Xbox to play games and then keeping it on afterwards to get other types of entertainment," Mehdi said. 

Over the past few years, Microsoft has added number of entertainment applications to the 360, including Netflix, ESPN, Hulu, Vudu, and YouTube.

On Tuesday, it is adding new video applications from HBO Go, Major League Baseball and Comcast Corp,'s Xfinity on demand video service.

The additions bring the total number of music, television and movie services available on Xbox Live to 36.

The new applications require that users be paying subscribers to Comcast's cable service, the HBO premium network, or MLB.tv. Those who pay will be able to watch more than 2,400 baseball games or more than 1,000 of HBO programming, including every episode of its original series like "Game of Thrones," "Boardwalk Empire" and "The Wire." Comcast subscribers will have access to thousands of movies and television shows from a variety of channels via Xfinity.

The launch of HBO Go on the Xbox is a big step towards the premium cable network's digital on-demand service becoming a direct alternative to its linear channels. While HBO Go is available on computers and a variety of digital devices like iPads, Xbox 360 owners will be able to watch it on televisions. Previously, the only way to get HBO Go on a TV was via the Roku box, which is far less popular than the Xbox 360.

"The Xbox has an extremely broad user base that can deliver a rich visual experience, which is a pretty big differentiator," said Berkes.

More than 20 million people are paying Xbox Live subscribers who can access the console's entertainment services. A total of 66 million Xbox 360s have been sold worldwide.

Microsoft previously said it would launch HBO Go and Comcast's Xfinity on its console before the end of 2011.


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-- Alex Pham and Ben Fritz

Screenshot of HBO Go on Xbox Live courtesy of Microsoft. 

Microsoft adding new television content to Xbox game console

Microsoft Corp. is adding significantly more video content to its Xbox 360 game console, though it's not yet ready to replace the cable box.

The technology giant has reached deals with nearly 40 television distributors and content providers that will offer more TV shows via the Xbox Live online service by this holiday season.

However, with only certain channels and programs available, the agreements fall short of aspirations Microsoft discussed at the E3 industry conference in June of making its console an all-in-one entertainment device that could replace traditional set-top boxes from cable and satellite television services.

Moreover, users will still have to subscribe to traditional cable services in order to access much of their content on the Xbox.

The nation's largest cable TV distributor, Comcast Corp., said it would put its Xfinity service on the game console, allowing its subscribers to watch a wide variety of TV shows on demand. Telecommunications giant Verizon also will offer some live channels from its FiOS TV service.

And, premium cable channels HBO and Epix will allow subscribers to watch their movies and original programs on demand through the Xbox, as will NBC Universal-owned networks Bravo and Syfy. Internationally, the BBC will be available in the U.K.

Marc Whitten, vice president of the Xbox Live service, said the agreements expand the console's entertainment offerings. Some 35 million people use the Xbox Live service, which extends the gaming experience online and provides access to movies, TV shows and music.

Over the last few years Microsoft has made a wide variety of TV shows available to watch or rent and also added popular on-demand offerings from Netflix and ESPN.

Roughly 40% of the time people spend on Xbox Live is devoted to activities other than gaming, with video consumption up 300% from a year ago, said Whitten.

A new version of Xbox Live will be released in time for the holidays to allow people to use voice and gestures (instead of remote controls) to search for movies and TV shows with Microsoft's Kinect controller.

"What we're trying to do is change the way the content is experienced in the living room," Whitten said.

-- Dawn C. Chmielewski and Ben Fritz


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Photo of Comcast Xfinity on Xbox Live, which will give subscribers access to over 10,000 episodes of catch-up TV. Image credit: Microsoft Corp.

Video games suffer second slump in 2010 as players curtail spending

Kinect Adventures

If the video game industry were an arcade game, you would be hearing the disappointing bloops that signal the player to try again.

For the second year in a row, U.S. video game sales posted a decline, down 5.7% to $18.6 billion in 2010 from $19.7 billion in 2009 and $21.4 billion in 2008, according to a report released Thursday by the NPD Group.

Both consoles and games took a walloping for the full year as consumers curtailed spending in an uncertain economy. Console sales fell 12.5% to $6.3 billion in 2010, and software sales fell 5.6% to $9.4 billion.

"Hardware sales were down 12% in units for the year, likely due to no price cuts and the continuing recession," said Michael Pachter, an analyst with Wedbush Securities. "And the decline in hardware drove the decline in software sales."

One bright spot occurred in a category that is often overlooked -- video game accessories, which in years past included extra game controllers, dance pads or keyboards. This year, however, accessories took off, gaining 13% to $2.9 billion as Sony introduced its Move motion controller for its PlayStation 3 and as Microsoft began selling its Kinect controller for the Xbox 360.

Kinect also fueled sales of the Xbox 360 in December, some of which came bundled with the new motion-and-voice-sensing controller. Xbox 360 sales jumped 42% to 1.86 million units in December, from 1.31 million in December 2009.

Sales of Nintendo's Wii, however, suffered a 38% dive to just 2.36 million units in December, down from 3.81 million a year earlier. Sony's PS3 also declined, albeit less precipitously. It sold 1.21 million PS3s in December, down 11% from 1.36 million.

With the exception of the Xbox 360, declining console sales will put pressure on manufacturers to lower the price, particularly for the Wii, which sells for $199.99 and is rapidly losing steam, analysts said.

"The Nintendo Wii business looks increasingly like a gift purchase business, which means they will have to have a price cut in order to sustain it during non-gift-giving seasons," said John Taylor, managing director of Arcadia Investments.

-- Alex Pham

Photo: A screen shot of Kinect Adventures for Xbox 360. Credit: Microsoft.


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The Morning Fix: Box-office trading gets closer to reality. Michigan says no to cannibalism. Rupert Murdoch goes after BSkyB

After the coffee. Before buying a vuvuzela to annoy my neighbors.

Box-office betting. The Commodity Futures Trading Commission voted to approve a vehicle that will clear the way for professional traders to bet on movie ticket sales. The movie industry's D.C. lobbying arm, the Motion Picture Assn. of America, has fought hard to stop this in its tracks, fearing that trading on box office could be manipulated and hurt the industry. Veriana, the company that got the approval, now has to stop legislation that would ban box-office futures trading. Veriana Chief Executive Rob Swagger blasted the MPAA and the legislation and promised to start lobbying Capitol Hill this week. The first movie traders could bet on is Sony's "Takers." That one stars Matt Dillon, and as much as I like him, it's been a while since he had the lead in a hit. His co-star, Zoe Saldana, is the flavor of the month right now, so maybe that will give the movie a little lift, but it still sounds risky to me. More on the decision and reaction from the Los Angeles Times and Variety.

Rupert wants control of BSkyB. Rupert Murdoch's News Corp. has made a bid to buy a controlling stake in British Sky Broadcasting, a satellite pay TV service. News Corp. already owns 39% of BSkyB and has offered $11.5 billion for the rest. BSkyB officials are willing to talk to Murdoch about a deal, but they want a higher price. More from Bloomberg and the Telegraph.

State-sanctioned piracy? North Korea's Central Broadcasting service showed the South Africa-Mexico World Cup match, but it didn't have the rights to do so. The Wall Street Journal says South Korea is looking into whether its coverage of the match was ripped off by the North Korean station. If it was, will North Korea be fined or will South Korea just arm every citizen with a vuvuzela and have them blow north?

Fresh ideas needed. With many of the summer's big-ticket movies flaming out, Vulture reports that Hollywood wants (gasp) original ideas for scripts instead of more remakes and sequels. Not to be too cynical, but I'm willing to bet that for every example of a recent script deal for an original concept that this story mentions, I can go find one based on an old TV show or movie.

Well, you have to draw a line somewhere. Michigan denied a tax break to filmmaker Andrew van den Houten, who wanted to shoot "The Women," a horror movie with a cannibalism theme in the state. It would have been his second movie featuring cannibalism to be shot in Michigan. Now though, some states are starting to take a closer look at the movies applying for tax breaks instead of just rubber-stamping a yes to every application. The New York Times sinks its teeth into this one.

Read the fine print. The Daily Beast looks at a bunch of reality shows and shockingly discovers that sometimes the cash and prizes promised winners don't always materialize quite the way participants might have hoped.

Inside the Los Angeles Times: Lots of E3 News, including ESPN doing a deal with Microsoft's Xbox and Richard Branson getting back in the game. Also, the romance between Hollywood and video game makers is starting to cool. 

-- Joe Flint

Betting on box office is risky. Following me on Twitter is safe. Twitter.com/JBFlint

E3: ESPN comes to Xbox 360 game console

ESPNXbox Walt Disney Co.'s ESPN has struck a deal with Microsoft to make its content available to users of the software giant's Xbox 360.

Under the terms of the deal, subscribers to Microsoft's Xbox Live Gold service will be able to get access to ESPN3, the sports juggernaut's broadband channel that carries a wide range of sporting events including Major League Baseball and the NBA as well as tennis, golf and college sports.

Subscribers to Microsoft's Xbox Live Gold service, which costs about $50 a year, will get access to the live sports events at no additional cost, as long as they also subscribe to Internet service through a cable company that provides ESPN3. Those include Verizon, AT&T, Comcast and Cox. This is the first time ESPN has agreed to release the content directly through a device that connects to a television, putting ESPN3 in more direct competition with traditional cable TV service.

Microsoft sees the deal as another way to expand its Xbox 360 beyond games into a full fledged entertainment device, said Ross Honey, a Microsoft executive who handles non-gaming partnerships for the the Redmond, Wash., technology company.

Microsoft has garnered a distinction for having a console with the most intense, gritty and complex games. That reputation, unfortunately, turned off average consumers, and Microsoft has labored in recent years to add features that would appeal to more mainstream players. Among other things, Microsoft added Netflix movie streaming, Last.fm streaming music and Facebook to its Xbox Live online service, which players access through an Internet-connected Xbox 360 console.

"Xbox Live will change the way you watch movies, listen to music and connect with friends," said Don Mattrick, who heads up Microsoft's games business.

ESPN had been discussing a deal with Microsoft for more than two years, said John Kosner, senior vice president of ESPN Digital Media. He said his company was particularly attracted by the interactive components Microsoft is adding to ESPN programming, including polls, trivia and the ability to connect with other users rooting for the same team.

"To me, the eye opener is having a live sports game experience in this video game world," Kosner said.

-- Ben Fritz and Alex Pham

Photo: ESPN commentators Josh Elliott and Trey Wingo demonstrating the ESPN 3 on Xbox 360 at Microsoft's E3 press conference Monday. Credit: Lawrence K. Ho / Los Angeles Times.

Microsoft gives its top-secret game controller a name: Kinect

At a gala event Sunday night, Microsoft unveiled the name of its latest video-game technology:  Kinect.

The unveiling capped a 45-minute performance by Cirque du Soleil at the Galen Center arena, which will be repeated again Monday night before the show is mothballed and sent back to Montreal, Canada, where the troupe is based. In the video above, Cirque du Soleil's artistic director, Michel Laprise, talks about how it approached the project in creating its one-of-a-kind show for Microsoft.

Microsoft is pulling out all the stops in an effort to market Kinect, which the company had previously code-named Project Natal. The device, when attached to Microsoft's Xbox 360 video-game console, lets people play games by gesturing, moving their bodies or speaking.  

Kinect is key to Microsoft's  effort to become the focal point of living room entertainment. Its Xbox 360, when connected to broadband Internet, is already capable of playing on-demand movies via Netflix and also lets viewers rent high-definition movies and TV shows, in addition to downloadable games. 

But Microsoft has thus far been saddled with a reputation of being a console for dedicated gamers, not average families. Kinect is the company's bid at attracting people who are too intimidated by its 14-button controller. Microsoft and other game developers are expected to unveil over a dozen Kinect titles this week during the annual Electronic Entertainment Expo starting Monday in and around Downtown Los Angeles.

-- Alex Pham

Video: Alex Pham / Los Angeles Times

Robbie Bach hits the escape button at Microsoft

Robbie Bach Longtime Microsoft executive Robbie Bach announced Tuesday his retirement in the fall from the Redmond, Wash., company where he has worked for the last 22 years.

As president of Microsoft's Entertainment & Devices unit, Bach, 48, oversees the company's Xbox, Zune and Windows for Mobile businesses.

Microsoft said two senior executives who had reported to Bach will answer directly to Microsoft Chief Executive Steve Ballmer. Don Mattrick, former head of studios for video game maker Electronic Arts, came to Microsoft in 2007 and will continue to manage the Xbox business. Andy Lees will remain senior vice president of Microsoft's mobile business. Both will report directly to Ballmer as of July 1.

Also leaving is J Allard, senior vice president of design and development. Allard will "take an official role as an advisor" to Ballmer, Microsoft said.

-- Alex Pham

Photo: Robbie Bach, president of Microsoft's Entertainment & Devices Division announced his retirement. Credit: Kevin P. Casey / Los Angeles Times


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