Last week it was Bill Gates claiming that Halo 3 would be ready in Spring 2006, in time to ruin Sony's PS3 launch party; now Robbie Bach, Microsoft senior vice president and chief Xbox officer, has decided to cast some doubt over those comments.

In a cover story on Time magazine last week, Bill Gates in apparent ecstatic mood was asking readers to picture a day when ...Sony launches, and they walk right into Halo 3. That story, tying in well with the XBox 360 hype at E3, must have generated a positive buzz regarding Microsoft's future console prospects.

Now that E3 has been and gone, the waters need some muddying and the first volunteer was Robbie Bach who in no uncertain terms decided to put the Microsoft Chairman in his place, The World's throne I assume, as he stated ...with all respect to Bill, I don't run Bungie's studio, and neither does he. We'll work with the Bungie guys and let people know, when they have something to announce. So Bungie doesn't belong to the rest of the world which Mr. Gates apparently does run.

What seems a bit more surprising is that Mr. Bach also stated that We haven't announced anything on what Bungie is doing or where we're going with the future of the 'Halo' franchise... Such a statement could raise some doubt as to whether Bungie is planning a clear sequel to Halo or some kind of spin-off while another possibility will be a quick numerical jump straight to Halo 360.

Now that we have seen the actual next-generation console hardware and had their manufacturers crowbar our jaws open, it is time to consider how much we'll have to dish out in order to remain cutting-edge gamers.

Following the exuberance of the big-three console launch events during E3, we were all left with the impression that the price tags accompanying the next-generation of consoles will be significant. It turns out that although that will be the case things will not be as bad as initially predicted.

Before E3 it was assumed that Nintendo's Revolution may be the cheapest of the three new consoles since the company has never launched a new console for more than USD 230. On launch GameCube cost USD 230 and was the cheapest of the three current generation gaming consoles while currently the GC remains the cheapest at USD 130. During E3 Satoru Iwata, Nintendo's president, took a stab at the other two major manufacturers by claiming that he plans to ...keep the Revolution at a price range that anyone can reach out for, and nothing as high as 50,000 yen (USD 463).

Microsoft's XBox 360 remains a mystery as far as pricing is concerned. Microsoft has had to deal with a variety of pricing issues in the current generation of consoles and was involved in negotiations of Machiavellian proportions. That alone suggests that this time round MS will have a lot more flexibility with its console pricing but a 3-processor R500-powered piece of hardware is unlikely to launch for under USD 350. The original XBox carried a USD 325 price tag on launch but has since reached the, more reasonable, USD 165 mark, contributing greatly to the large loss of Microsoft's gaming division. Some recent reports by analysts have suggested that XBox 360 may not be able to achieve its USD 350 planned launch price and may retail for USD 400 to begin with.

Anyone attending Sony's E3 Playstation 3 press event would have been impressed by the promises of Teraflops made by the consumer electronics giant but would have also been under the impression that the next-generation console will be priced in body parts and not just an arm and a leg but possibly a kidney and an eyeball; supercomputers after all don't come cheap. New information however, suggests that Sony may be able to compete with Microsoft on price even though it claims that its console is more powerful than its rivals. The new report claims that SCE has informed its business partners that the PS3 will retail for under USD 370 at launch. This is a significant drop from the, initially predicted, USD 450 price tag but fits in nicely with previous Sony Playstation launches since both the PS and PS2 cost USD 368 at launch.

It seems then that Sony and Microsoft may launch their next-generation offerings for around the USD 350-400 mark something which suggests that things will heat up quick. Nintendo's Revolution may remain the cheapest console but it is expected that Microsoft will try and exploit the time advantage it will have by launching XBox 360 in November 2005. First estimates claim that Microsoft will attempt to push 3 million units in Q4, 2005 alone.

A pair of Apple Powermac G5 systems were actually running the Xbox 360 demos, not the 360 console. The consoles in the kiosks weren't actually running, they were just for show - now you know why all the controllers were wired.

Nintendo, Sony and Microsoft officials have begun trading blows, just a week after they gave the public a glimpse of their next-generation offerings. Using the Japanese media as a platform, high-ranking executives of the three warring factions, revealed their unmitigated scorn of the opposition. The odd thing is that very few people will be surprised by what was said as everyone involved stuck, pretty much, to the script that was used during the previous-generation conflict.

Sony's Ken Kutaragi was dismissive of Microsoft's next-generation effort and refused to even compare 360 and its parent company's ambitions to his vision for PS3.
When asked to comment on Microsoft's success at displacing PS2 from the top of the sales chart for a short while recently in the U.S., Mr. Kutaragi was venomous. He claimed that the incident was a hiccup and compared MS to a novice martial artist taking on an expert. We would like to formally put in a request to see Bill Giggles Gates take on Ken The Boastful Kutaragi in a quick fight and see who does a 360.

Mr. Kutaragi was also eager to stress that the Playstation 3 was the console with the most potential and definitely the one to watch in 2006. Sony's big cheese will have to decide however, exactly how he will want gamers to use the new Playstation console as his latest description of his vision for the future seemed to wander off into digital image analysis and other high-definition endeavors.

Microsoft was quick to unleash its crack teams of speech writers and anti-venom units and came up with Chief Xbox Officer Robbie Bach's comment, We will become the market leader with our next-generation console. Mr. Bach did however add insult to injury by claiming that the Nintendo and Sony presentations were unremarkable and showcased nothing beyond XBox 360's capabilities. He must have been watching something else as Sony's demonstration clearly went a step further than anything MS had showcased. As a result you can either believe Sony was being economical with the PS3 truth or that the PS3 will blow XBox 360 out of the water, ducks and all, probably using eyetoy and in flawless physics.

Mr. Bach also described PS3s support of 7 players and double HDTV output as excessive while he claimed that adopting Blu-Ray was a risk. Kutaragi did however, explain the choice of Blu-Ray as an attempt to establish the format and suggested that the meteoric rise of DVD popularity was, in part, a result of the PS2.

Nintendo president Satoru Iwata, not wanting to miss the fun, also decided to comment. He raised his voice and clearly said No Comment when asked if the Revolution will come in Q4, 2006. He then decided to throw some information our way as he went on with his usual gameplay versus raw power rhetoric, supporting his views by using a financial model which suggests that game development costs will rise to such an extent that innovation might become collateral damage of the next-gen war.

We have to admit as the next-generation news keeps coming in, Mr. Iwata's ideas seem to be growing in appeal, much as the mustache-bearing, humpbacked, team leader of the womens power-lifting team might do after a few beers. Mr. Iwata did not miss the opportunity of taking a stab at this fellow next-gen combatants by claiming, We're not about selling new kinds of TVs or taking control of the living room...

XBox 360 is expected to launch in November 2005 in the U.S. with the company helping to make it recently having claimed that production of the units will start in China in September 2005. Microsoft's console is expected to cost around USD 300 at launch although no one is willing to confirm that at this point.

Sony's PS3 is expected to launch in spring 2006 with the most recent estimate of its price being USD 350-400.

Ninttendo's Revolution is expected to be the last next-generation console to launch (latest estimate Q4,2004) and should be the cheapest offering.

Now that we have seen the actual next-generation console hardware and had their manufacturers crowbar our jaws open, it is time to consider how much we'll have to dish out in order to remain cutting-edge gamers.

Following the exuberance of the big-three console launch events during E3, we were all left with the impression that the price tags accompanying the next-generation of consoles will be significant. It turns out that although that will be the case things will not be as bad as initially predicted.

Before E3 it was assumed that Nintendo's Revolution may be the cheapest of the three new consoles since the company has never launched a new console for more than USD 230. On launch GameCube cost USD 230 and was the cheapest of the three current generation gaming consoles while currently the GC remains the cheapest at USD 130. During E3 Satoru Iwata, Nintendo's president, took a stab at the other two major manufacturers by claiming that he plans to ...keep the Revolution at a price range that anyone can reach out for, and nothing as high as 50,000 yen (USD 463).

Microsoft's XBox 360 remains a mystery as far as pricing is concerned. Microsoft has had to deal with a variety of pricing issues in the current generation of consoles and was involved in negotiations of Machiavellian proportions. That alone suggests that this time round MS will have a lot more flexibility with its console pricing but a 3-processor R500-powered piece of hardware is unlikely to launch for under USD 350. The original XBox carried a USD 325 price tag on launch but has since reached the, more reasonable, USD 165 mark, contributing greatly to the large loss of Microsoft's gaming division. Some recent reports by analysts have suggested that XBox 360 may not be able to achieve its USD 350 planned launch price and may retail for USD 400 to begin with.

Anyone attending Sony's E3 Playstation 3 press event would have been impressed by the promises of Teraflops made by the consumer electronics giant but would have also been under the impression that the next-generation console will be priced in body parts and not just an arm and a leg but possibly a kidney and an eyeball; supercomputers after all don't come cheap. New information however, suggests that Sony may be able to compete with Microsoft on price even though it claims that its console is more powerful than its rivals. The new report claims that SCE has informed its business partners that the PS3 will retail for under USD 370 at launch. This is a significant drop from the, initially predicted, USD 450 price tag but fits in nicely with previous Sony Playstation launches since both the PS and PS2 cost USD 368 at launch.

It seems then that Sony and Microsoft may launch their next-generation offerings for around the USD 350-400 mark something which suggests that things will heat up quick. Nintendo's Revolution may remain the cheapest console but it is expected that Microsoft will try and exploit the time advantage it will have by launching XBox 360 in November 2005. First estimates claim that Microsoft will attempt to push 3 million units in Q4, 2005 alone.

Microsoft plans to heavily subsidize its XBox 360 console in order to keep its launch price down to reasonable levels and possibly to trouble rival Sony, expected to have a problem keeping its PS3 price down to similar levels.

Major investment bank UBS reckons MS will subsidize 360 to the tune of USD 75 in order to achieve a launch price of USD 299. These estimates may be the result of complex calculations but most gamers had figured as much out since Microsoft's J. Allard had claimed that the console would launch for around USD 300; add to that the information released last week, by the Toronto Globe and Mail, that each 360 would cost MS USD 375 to make and feed the data to Big Blue, the print out should read USD 75.

The news is really not that remarkable as console manufacturers are known to subsidize their products at launch in order to convince consumers to buy them. The real money is made through sales of games, expected to become even more expensive for next-gen consoles.

Last time round Sony subsidized its PS2 at launch but had the flexibility to begin making money on the hardware later on in its production-cycle, as the company was making most of the hardware itself. Microsoft did not have the same options available with the original XBox and is still making a considerable loss on every unit sold. This time however, it is expected that MS will be able to begin making a profit on the XBox 360 fairly soon.

is still making a considerable loss on every unit sold

Officials from Microsoft Corp. have released details of the company?s quarterly results, revealing sales which show better-than-expected demand for personal computer software, as well as strong sales of server software and Xbox hardware.

The corporation as a whole reported a net profit of $2.56 billion for the fiscal third quarter ended March 31. This compares with $1.32 billion for the same period last year.

Yet despite naming the Xbox as one of its core revenue streams, Microsoft?s Home and Entertainment division (which includes Xbox, PC games, the Home Products Division (HPD) and interactive TV), still ended at a loss of $154 million for the quarter, compared to a loss of $209 million for the same period last year. However, revenues were $593 million, up from $530 million in 2004.

The losses, according to the company, result from the Xbox console's continued 'negative gross margins', meaning, in effect, that the more consoles Microsoft sell, the more the company reduces its profits.

With the impact of Halo 2 now much diminished since Christmas, when the division actually made a small profit, the company has no way of generating profit from the format without much stronger software sales. (This situation is largely assumed by analysts to be the reason why Microsoft is so keen to start the next generation of Xbox hardware as soon as possible, to more quickly reach hardware break-even point.)

Even so, the fact that revenue is creeping up as the format matures does suggest that the Microsoft?s policy of launching the next generation Xbox early, and before the PlayStation 3, could well pay dividends. Xbox revenue increased $42 million, or 13 percent, largely as an increase in revenue from third-party games and an increase in Xbox Live memberships - also a positive sign.

The Xbox U.S. games attach rate also increased to 8.0 games per console, according to industry analyst NPD. Revenue from consumer game hardware and software, PC games and TV platforms increased $21 million, or 10 percent.

For the full nine months ended March 21st, Home and Entertainment revenue increased due to a 19 percent increase in Xbox revenue, largely due to the success of Halo 2, although this was partially offset by a 5 percent decline in consumer hardware and software, PC games and TV platforms.

Decreases in the division?s operating loss were partially offset by an increase in costs associated with the next generation console development. These additional costs should obviously lessen as work on the new Xbox comes to an end.

meaning, in effect, that the more consoles Microsoft sell, the more the company reduces its profits.