The device is being developed in response to the PS3 driving sales of games software and Blu-ray content in several countries. A recent Sony Brand Wave study conducted in five countries including the UK, Australia, France Germany and Spain revealed that a key reason that consumers are buying a PS3 is because it includes a Blu-ray player.
Recent GFK research reveals that the recently launched Xbox 360 HD DVD attach player is not selling well. Another factor that impacted early sales of the Xbox 360 was that Microsoft failed to include a HDMI port - omitted because Microsoft wanted to cut down the costs of the console in an effort to compete up against the PS3.
The new Xbox device, while allowing for extensive gaming capability, will be positioned as an entertainment hub that includes gaming and extensive wireless networking capability as well as 1080p playback. There is also talk of it including a dual HD TV tuner and EPG capability and a docking port for an MP3 player. For Toshiba, the device is critical if it is to be successful in beating Sony and the Blu-ray promoters.
Also being discussed is the development of an open standard docking port similar to the 17 pin iPod port. This would allow all manufacturers to use the same port for docking.