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Microsoft Adds Disney Movies to Xbox Marquee

By Walaika Haskins
Jul 11, 2007 1:15 PM PT

Microsoft opened this year's E3 Media and Business Summit Tuesday with two major announcements -- the addition of Disney films to its Xbox Live download service for the Xbox 360 as well as its lineup of new titles for its "Games for Windows" brand, most set for release during the 2007 holiday season.

Microsoft Adds Disney Movies to Xbox Marquee

"We're always looking for more ways to let people experience our films," said Dan Cohen, executive vice president of pay television and interactive media for Disney-ABC Domestic Television. "With the millions of Xbox 360 consoles in living rooms today with a direct, high-speed Internet connection, Xbox Live really has become a terrific device for the delivery of digital entertainment content."

The company also revealed its collection of some 30 new titles for its "Games for Windows" brand for both the Xbox 360 and the PC from major developers including Activision, Bethesda Softworks and Midway.

"Windows gaming is set to see one of its best years ever, with an incredible range of phenomenal titles, amazing hardware and the rapid adoption of Windows Vista, Windows gamers will remember holiday 2007 as a landmark year for PC gaming," said Peter Moore, corporate vice president of the Interactive Entertainment Business in Microsoft's entertainment and devices division.

Popcorn, the 360 and a Movie

Following Tuesday's announcement, Xbox 360 owners could begin downloading high-definition versions of new and classic movies from the Disney vaults, available via the Xbox Live Marketplace. Disney joins movie studios including Lionsgate, New Line Cinemas, Warner Bros. Home Entertainment, Paramount Pictures and a bevy of television networks such as CBS, Cartoon Network, Comedy Central, The CW, MTV, NBC, Nickelodeon, Spike TV and VH1.

With the Disney deal, Microsoft adds 35 film titles from Hollywood Pictures, Miramax Films, Touchstone Pictures and Walt Disney Pictures to the 2,350 hours of video content currently available on the Xbox Live Marketplace. Films like "Armageddon," "Bridge to Terabithia, "The Queen," "Unbreakable," "Tarzan," and "The Waterboy" are now available for on-demand rentals.

New releases in HD will cost Xbox Live members 480 Microsoft Points each, with standard-definition releases ringing up at 320 Microsoft Points apiece. Classic films will run Xbox 360 users 360 points for HD versions and 240 points for standard definition downloads. One hundred points costs US$1.25.

The Wii Effect

In Microsoft's quest to make the Xbox 360 a must-have device for the living room, the tie-up with Disney is a significant gain for the Redmond, Wash.-based company, Rob Enderle, principal analyst at Enderle Group, told TechNewsWorld. The deal should also bump up the Xbox 360's lead over Sony's PlayStation 3 in terms of compelling content, although consumers have still not fully come around to the idea of a gaming console as a set-top box in the den or living room, he added.

"Disney is the only studio people actually ask for by name," Enderle pointed out. "[And it's] arguably the most powerful [studio] in the segment. As a bellwether for that industry they are unmatched. It should [increase the Xbox 360's lead over the PS3], however the market has not completely accepted the idea of a game console as a set-top box yet."

The venture, according to Enderle, could also help boost sales of both the Xbox 360 Elite, which boasts a 120 GB hard drive, compared to the standard version's 20 GB hard drive. It could also pump sales of the add-on hard drive sold for the standard version of the game console. Microsoft's numbers indicate that some 11.6 million Xbox 360 consoles have been sold since its release in November 2005, reportedly just shy of its goal to sell 12 million units by the end of June. A little under half of that number, 5.8 million, was sold in the U.S. Thus far, according to Microsoft, its console holds a 2-to-1 lead in sales over archrival Sony's PS3 platform, released in November 2006. Just last week, the company announced that it would begin selling the Elite model.

The distribution alliance also boosts Microsoft's attempts to cast the Xbox 360 in a more family-friendly light. The unexpected success of the Wii has caused the company to make a push to broaden the audience for its current generation console, Enderle said.

"The PS3 isn't really a threat anymore, [so] focus has shifted to the Wii, which did a better job of opening up the [family/casual gamer] market. The Wii really surprised both them and Sony. Sony has other issues, but Microsoft is now shifting to address the competitive threat and related opportunity of family gaming.

"Sony is basically out of the game right now and struggling back in," Enderle added. "The fight is increasingly between Nintendo and Microsoft. Nintendo is focused on keeping it simple and low cost, and Microsoft on providing a richer experience that also comes with a higher entry cost."

Gaga for Gaming

Microsoft also announced its lineup of video game titles that will hit store shelves during the coming holiday season as part of its Games for Windows brand. The titles include just under 30 new releases and more than 60 Games for Windows-branded titles such as the much anticipated new titles "Crysis," "Hellgate: London," "Age of Conan: Hyborian Adventures" and "World in Conflict."

Other standouts include the third edition of the first-person shooter "Halo 3;" "Mass Effect," a sci-fi role-playing game (RPG) exclusive to the Xbox 360 from the creators of the "Star Wars: Knights of the Old Republic" series; "Call of Duty 4" set for the Xbox 360 and PCs only; the eagerly anticipated Crusades-era action game, "Assassin's Creed"; and Electronic Arts' "Rock Band," which comes with drums, a guitar and bass, and a microphone. "Rock Band" is intended to take on Activision's hit "Guitar Hero" series.

In addition, Microsoft revealed that game developers Eidos, Sega and THQ will join Microsoft Game Studios to create content for the Game for Windows - Live online service for XP and Vista. The first titles include the highly acclaimed "Gears of War" and "Viva Piņata," formerly only available for the Xbox 360, as well as Sega's "The Club," "Kane and Lynch: Dead Men" from Eidos, "Juiced 2: Hot Import Nights" from THQ, and "Universe at War: Earth Assualt," also from Sega.

"Gears of War" will offer players five new campaign chapters, a new multiplayer mode and a new game editor that will allow players to unleash their creativity, the company said.

With its fall titles, Microsoft will offer a "powerful title set," Enderle explained, that will up the ante for Nintendo's Wii and the PS3 which suffer from the ongoing problem of a lack of compelling game content.

"The Wii gets around this with a better price, tighter focus and a better family gaming experience but, on game content alone, Microsoft is clearly setting the pace," he noted. However, he added that the company is relying heavily on sequels, a category upon which EA head John Riccitiello launched a withering commentary this week.

"In some cases, yes, many are safe titles and not particularly interesting. Yes, most of the industry has been lacking creativity of late which is why the 'LMNO' Spielberg thing was so important," Enderle said, referring to recent previews of games created by EA in cooperation with movie director Steven Spielberg.


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