Microsoft Fuses Xbox, IPTV Software

Las Vegas -- Microsoft announced Monday that it will combine the Xbox 360 with its IPTV software for service providers, effectively turning its video-game console into an IPTV set-top box.

Microsoft said the IPTV-enabled Xbox will be offered by service providers "by holiday-season 2007." The software company didn't say which of its IPTV customers may be planning to offer the device. In the United States, AT&T is the largest company offering TV services via Microsoft's IPTV Edition software.

The IPTV-enabled game console -- which Microsoft refers to as "IPTV on Xbox 360" -- besides providing both TV and video games in one unit will combine elements of the two. For example, Microsoft plans to let TV viewers access Xbox Live community-based features, such as voice chat and sending and receiving text messages, while watching TV.

''Both Xbox 360 and Microsoft TV IPTV Edition by themselves deliver unique and exciting entertainment experiences today, but IPTV on Xbox 360 is truly a solution that is greater than the sum of its parts and will enable even more exciting experiences to delight consumers, service providers, content providers and game developers alike,'' Robbie Bach, president of Microsoft's Entertainment and Devices Division, said in a prepared statement.

Microsoft said it has sold more than 10.4 million Xbox 360 consoles in 37 countries to date. Outside of the United States, Microsoft's IPTV Edition software has been commercially deployed by BT Group in the United Kingdom, Deutsche Telekom in Germany, T-Online in France and Swisscom in Switzerland.