Let the rumors and speculation fall by the wayside. Microsoft officially took off the wraps on its next-generation system Tuesday, revealing the name and form factor (but regrettably no price) -- and also a major focus on replacing your cable box. Let's start with the name: Xbox One. Microsoft threw a bit of a curveball here, with the rumor mill churning out numerous naming conventions but not foreseeing this one.
Microsoft then unveiled the system itself. The box's footprint looked bigger than the Xbox 360, looking similar in size to a cable box. Xbox One, which will launch later this year, will come with 8 gigabytes of RAM, USB 3.0 inputs and a Blu-Ray drive -- all upgrades over the current-gen system.
But Microsoft spent a majority of the press conference demonstrating how Xbox One could revolutionize the way we watch TV. Instead of switch between multiple boxes (cable and video game console), Microsoft is touting the Xbox One as an all-in-one system. Microsoft showcased how the Xbox One will be able to play live TV (but did not mention cable providers or service cost) and switch to playing a game without turning on a different system or change the video source on your TV.
The speed and simplicity of the demonstration was the real breakthrough feature. The ability to flip between live TV, gaming and the numerous applications on Xbox Live streamlines a process that has become cumbersome with numerous TV controllers cluttering the living room. Even the sometimes arduous task of remembering what network is on what channel has also been addressed. Simply by saying the TV network or the show will alert the Xbox One to search for that particular channel and make the appropriate change.
This is all powered by Kinect 2.0, Microsoft's take on motion tracking. Kinect 2.0, which will be bundled with each Xbox One and will be necessary for the Xbox One to function, will play a central role for this next-generation system. Much like the 360, you can control the system with your voice and hand gestures, but Microsoft touted Kinect's "unprecedented" accuracy. The system is said to be able to pick up your wrist rotation, balance and even your heartbeat.
But the main functionality demoed during the press conference centered on navigating the user interface. You can turn on the Xbox One by simply saying "Xbox on". The system will recognize your voice, load up your profile and remember what you were doing last. The operating system, which looks similar to the Xbox 360's tile-themed UI mixed with Windows 8, will display the last game you played, show you watched and applications used. You also can switch between different tabs to find more content. The trending tab gives you a snapshot of what's popular with your friends and the Xbox community.
One of the more impressive demonstrations was the impressive multitasking capabilities. The Xbox One has the ability to seemlessly switch between live TV, games and applications instantly. Simply saying "Xbox watch TV" turns on live TV but then you can snap a second application off to the side (similar to the Windows 8 tile multitasking feature). This enables you to carry on a Skype video call while you watch a movie or play a game.
Microsoft also reached out to sports fans during the press conference. The company showed how during an NBA broadcast, the Xbox One will be able to update you on how your fantasy players are performing through notifications or by snapping your fantasy league off to the side of the broadcast. This interactivity could become even more engaging in other forms of entertainment like political debates or award shows.
The Xbox 360 controller also got some tweaks -- the biggest of which was to the D-pad, which ditches the current gen's clunky design for what appeared to be a more precise input method. It appeared as though the start and select buttons have been changed to a menu and what looked like a screen-in-screen button. The new controller seemed to look like a blend between the original Xbox controller and the 360. Microsoft touted 40 design iterations.
The system will have a dedicated gaming DVR and native editing and sharing tools. With the explosive popularity of gaming videos, it seems Microsoft and Sony, which also announced a DVR-like system in the PS4, are giving gamers tools to simplify this process.
Microsoft did debunk the rumor that the system will need an internet connection to function. Your content can be stored in the cloud, and all games will need to be installed on the hard drive. The latter means that Xbox One will have to ship with an expansive hard drive or come with a very large amount of cloud storage. The system will not be backwards compatible (so you will need to keep you 360 if you want to play those games), but your achievements, which were hinted at becoming dynamic, and gamertag will carry over.
But in the end this is a gaming system. And though Microsoft said it's saving its big announcements for E3, which is a little more than two weeks away, there was some gaming news though none of the games shown were live demonstrations.
Arguably the biggest game at the event was "Call of Duty Ghosts." This game will take place in a new world, have a fresh cast of characters and will be developed on Activision's next-generation engine. Character customization and dynamic maps are two of the new features that will be in "Ghosts."
Activision released the first trailer for "Ghosts," which showed off some of the new gameplay mechanics such as leaning out of cover to shoot, sliding on the ground and mantle over obstacles. Fine hairs, bruising, cuts and even dirt under the fingernails are now possible in this engine. Microsoft has extended its timed-exclusive deal with Activision, giving Xbox users DLC first.
EA also announced a partnership with Xbox, providing exclusive content to Xbox One. has a relationship with Xbox. FIFA, Madden NFL, NBA Live, UFC. EA Sports showed footage of the new versions of FIFA, Madden NFL, NBA Live and UFC, each running on its new engine -- Ignite. EA said that the Ignite engine will produce 10 times more animation and detail.
Microsoft did reveal that a new entry into its exclusive racing simulation -- Forza Motorsport 5 -- will be available when the Xbox One launches. The trailer showed off an immense amount of detail and some impressive lighting effects, but it was a trailer -- not live footage.
Microsoft did tout that there will be more than 15 exclusive games, eight of which will be brand new franchises, in first year of Xbox One. We should get more details on these games at E3.
We assumed that Microsoft would focus heavily on wide-reaching entertainment -- and it did just that. The multitasking and Kinect functionality was very impressive and definitely the highlight of the press conference. Microsoft did make a compelling argument to be your all-in-one set-top box, making cable TV more interactive. Improvements were made to Kinect and the controller, but the lack of gaming-centric news will be something that is expected to be addressed at E3.