Microsoft reveals Kinect system

Microsoft Corp christening its new
motion-sensing game system “Kinect,” on Sunday offered a sneak peek
of upcoming titles it hopes will help draw a new generation of casual players
into the 40 million-strong Xbox game console fold.

In a performance conceptualized by
Cirque du Soleil, the company staged enactments of how games would be played.
Those included a track and field tournament, a driving simulation in which passengers
rock their bodies to toss the car into cartwheels, and a Star Wars game with
enhanced control of a Jedi knight – which drew cheers.

Microsoft did not announce game
publishers for Kinect — previously dubbed Project Natal — nor divulge any
other details. LucasArts releases Star Wars titles.

The world’s leading gaming hardware
makers, hoping to reignite the slumping $60 billion industry by expanding it
beyond hardcore games to more casual players, will unveil at the E3 Exposition
in Los Angeles this week a range of futuristic gadgets.

Microsoft is expected to flesh out
details of its Kinect system at the annual games convention, which along with
Nintendo’s 3D-without-glasses platform is expected to generate the most buzz.

Sony Corp will show off its
competing Move motion-sensor.

Microsoft — which recently lost
its mantle as world’s largest technology company to Apple Inc — unveiled Natal at last year’s E3.
Analysts estimate the three-camera device, which will be in stores by this
holiday season, will range from $50 to $200.

The set-up — which allows for
completely hands-free games and controlling the console with voice commands —
is designed to appeal to casual players and newcomers who may not be aware of
the product, rather than hardcore gamers, analysts said.

“There’s only so much headway
you can make until you bring moms into the equation. There’s lots of kids and
moms who want to have an interactive experience together,” said Mike
Delman, vice president of global marketing for Microsoft’s interactive
entertainment division.

The rush of new technology comes
just as the video game industry, which dwarfs the $10 billion domestic movie
box office, needs it. Total U.S.
industry sales — hardware, software and accessories — are down more than 10
percent to $4.7 billion this year through April, according to retail research
firm NPD Group.

Hardcore

Delman estimates that, of the 40
million Xbox gamers around the world, up to 30 million were considered
“hardcore,” with another 10 million drawn by more mainstream games
such as “Madden” football. Microsoft hoped to draw in tens of
millions more with Kinect, which relies almost exclusively on body motions and
gestures, he said.

Among other games demonstrated on
Sunday were a full-interactive instructional dance video, a virtual pet
simulation featuring four furry felines including tiger and lion cubs that
players can stroke and train, and a serenity-inducing yoga-taichi exercise
game.

Five years after its launch, there
are more than 40 million Xbox 360s in homes and 23 million paying subscribers
for Xbox Live, according to Microsoft.

In a best-case scenario, Natal could extend the
lifespan of the machine another four or five years, potentially boosting the
number of installed consoles to 60 million to 70 million, Wedbush Morgan
estimates.

Typically by the fifth year of
sales, hardware demand crests, but software sales are fueled by a base of users.

Microsoft’s ambition — despite its
spotty track record of engaging consumers outside of gaming — is to make the
Xbox the nexus of household entertainment. It already offers Netflix movies and
Zune music and videos through its Xbox Live online subscription. There has been
talk that it will add Hulu TV shows to the service at E3.