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Thanks to finalsquall and Gamer4eva for raising very interesting points. Folks this can't just be explained away as just arising out of the natural capitalistic need to make profits. Even though profit is one of the biggest driving reasons, there is a lot more going on here. Central to this is the domination of the home PC environment by windows. Microsoft's monopoly over the Operating System which is used to run computers in almost every household in the world is what gives them such incredible strength. They are capable, at will, to make people buy any new version of Windows that they make every few years. If I go into a shop today and buy a new computer, it already comes preinstalled with Vista. I have no choice but to upgrade, even though I hate it. This is also what causes any Microsoft software product to beat all others (Microsoft office tools, Internet Explorer etc). Its simple, only MS products are given the secrets to using Windows in the most optimum way. For Windows code is not open to anyone but MS, so all other competing products find it very difficult to write code that works with similar efficieny and since 90%+ of the computers are running on Windows, you have the battle won. This is how Netscape Navigator was destroyed and competing office tools from Sun, Apple and Google are having such a hard time competing.
During the time of the PS1 Microsoft detected the emergence of a new market area in the home entertainment scope. Microsoft foresaw, correctly, that video games consoles would not remain solely about video games but would grow to encompass music, movies, online browsing, social networking etc.This emerging market will unseat the PC from the throne of the home media. In the process the monopoly established by Microsoft would also be rendered ineffective, unless they establish domination in the new market. What MS is doing is just that, to establish complete control over the video game industry by standardizing the hardware. This will in turn allow them to dictate the software to be used on top of that. Admittedly, by rushing in headlong into the video games arena, MS might be driving new features, price cuts so on and so forth. However I am wary of MS winning this war too soon, coz that wud start the monopoly yet again. I admire Microsoft a lot for their strengths and I like some of their games incredibly (Age of Empires, Freelancer, Gears, Mass Effect) but I have to say it like the way it is.



 

It is better to die on one's feet

then live on one's knees