Rumor Mill: Microsoft poised to deliver 'Xbox' game system

I've avoided reporting on Microsoft's rumored entry into the video game market, largely because I've been unable to independently verify much information about this project, dubbed the Xbox. But if the rumors are correct, Microsoft Corporation will duke it out with Sega, Sony, and Nintendo this fall when it unleashes its first video game console, which will offer PC-like performance and capabilities.

The Xbox is said to be powered by a 600 MHz AMD or Intel microprocessor and 128 MB of RAM, using PC-compatible components. And because it will run on a gaming-enhanced, stripped-down version of Windows, it will offer programmers a familiar development environment and provide software compatibility with the thousands of Windows games currently on the market.

The unit will reportedly be competitively priced with existing and upcoming products from the leading video game console makers, but if Microsoft has hopes of dominating this industry, it has a fight ahead of it. Last fall, Sega unleashed its 128-bit Dreamcast system, which features a proprietary, high-speed CD-ROM and hardware accelerated graphics. Sony unleashed its follow-up to the enormously popular PlayStation, cunningly named the PlayStation 2, in Japan just this past week. And Nintendo is working on a next generation console dubbed "Dolphin" that it hopes to release later this year as well.

It's hard to understand where the Xbox would fall within the ranks of such competition. In each generation of video gaming, dating back to the late 1970's, one unit has stood out as a sales leader, regardless of technical merit. In the early days, the lowly Atari 2600 beat out contenders from Mattel Electronics and Magnavox, until it was briefly eclipsed by the Coleco Adam, which fell to the video game shakeout of 1983. In the late 1980's Nintendo revived the sagging video game market with its NES, handily defeating competition from Sega and NEC. Sega then dominated the 16-bit market with its Genesis device, which out-performed Nintendo's NES follow-up, the Super Nintendo (SNES), and consoles from Atari ("Jaguar") and other companies. More recently, the technologically inferior Sony PlayStation has dominated entries from Nintendo (N64) and Sega, with its ill-fated Saturn.

The next generation of video gaming hardware arrived last fall with the release Dreamcast, which ironically offers a Windows CE operating system layer with Direct3D graphics, as well as Internet access options and other modern features. But Microsoft's entry may be too late: Sony's Japanese launch of the PlayStation 2 was a smash success, with almost a million units sold in the first 48 hours. Past experience shows that the market generally allows one product to be extremely successful, while one or (maybe) two others are moderately successful. Whether Microsoft will be one of these players remains to be seen, but we'll know more about the company's plans (or lack of plans) for this market on Friday when Bill Gates addresses the Game Developers Conference in San Jose, California

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