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Ok I'll get the negative out of the way up front, the arcade games look like complete crap.

Now the positive: it's an interesting concept and it's something that's lacking on all consoles, a central meeting place or hub. Since using a keyboard and mouse is awkward on a console (at least for those simply sitting on a couch or laying on the carpet) this seems like a logical choice for an interface. It'll be interesting to see how it does.