Microsoft is faced with an important dilemma concerning its choice of release date for the XBox 2. According to developer reports and to a steady supply of leaked statements, Microsoft's next-gen console is the one that is nearest release and the company now has to decide if it will risk launching it by Christmas 2005.

According to several key industry sources, Microsoft is working towards a Christmas 2005 launch for its next Xbox console in US, with a European release likely to take place in early 2006. If XBox 2 does go down that route it will be a clear indication that Microsoft is attempting to pull a Sony on the next-gen console market by getting a clear lead in store-shelves. As is obvious there is an inherent risk in that strategy since rivals will be able to adapt their console designs in order to claim superiority to XBox 2.

US sources, including a major publisher claiming that Microsoft is definitely targeting Christmas 2005 with its next XBox, have been insisting that MS is willing to take that risk, especially when considering that PS3s launch may be pushed back as far as 2007. The first reports surfaced when developers begun revealing XBox 2 game release dates which were very close to the Christmas 2005 season.

Microsoft has suffered this round of the console wars, largely due to Sony's head start with the PS2 and the news coming from Sony itself can only be seen as encouraging with Sony's European chief David Reeves, already having claimed that the PlayStation 2 is only halfway through its life-cycle. There is also speculation that Sony's insistence to integrate high-end DVD technology into the PS3 may also lead to a delay.

If all these leaks and expert guesses prove right, Microsoft could end up with a one year jump on the PlayStation 3, with Nintendo's offering, currently codenamed Revolution, expected to appear half-way between the two.