Xenon (X-Box 3) coming soon?

[kn]

I think it is a no-brainer that microsoft will show up early to the next party. Microsoft has proven that they are not innovators but rather great at taking existing ideas and bettering them just enough to take over the market. There are three things at play that are "maturing" at the moment:

High Definition Displays. They still are only in about 30% of households. In 3 more years, that number will be more like 70%. Graphics will be even more important than they are today.

Motion Controls. The Wii has proven that (in some titles) the motion-based controller is exceptionally fun. Expect that Microsoft will refine the Wii Controller for their next console. It will have faster response times and greater accuracy than the current WiiMote. Add to it the higher horsepower of the console to track and display movements in real time and you will finally have 1:1 motion control.

High(er) Definition disk formats. It may be HD-DVD and it may be Blu-Ray. Or, it may be something else entirely. Whatever "it" is, prices will have come down by then and inclusion in the console won't be the price buster like it was for the launch of the PS3.

If Microsoft maintains 100% backward compatibility and the architecture says similar but with more overall horsepower, developers won't be upset as long as the development tools are ready out of the gate...

I don't think there is any question that it will happen by 2010, but I do believe timing will be based on how the PS3 fares in the coming year. If the PS3 begins to outsell the 360 significantly on a worldwide basis it will be sooner no doubt... If the 360 takes down the PS3 this round, I suspect they will push it out a bit...