Rumor has it Microsoft may announce that they are going to license 360 hardware design to traditional electronic companies such as Toshiba...

http://seattletimes.nwsource.com/html/businesstechnology/2004100550_brier31.html

If this happened, how would that change the market for consoles? 

Yes it would.

now that's an interesting idea. goes the completely opposite direction as nintendo's business plans.

apple tried it, failed completely. IBM did, tremendous success.

now they get the specifications right is another issue. but i would love to own an xbox whose manufacture is not microsoft (reliability issue). i don't know what kind of innovations can come with it, but i do know prices will come down in a hurry.

That would solve the RROD problem ... Microsoft cant do hardware

From the article:

"Microsoft could also make a splash by announcing plans to give the Xbox 360 an internal HD-DVD drive, putting it on par with Sony's PlayStation 3 that has a built-in Blu-ray drive."

I don't see the point in this, given that it wouldn't make sense to release games on HD-DVD, since there are 16 million 360's without that drive out there... If it's just for movies, fine, but not as the main SKU - Sony already learned from their mistake of making their console too expensive, why would Microsoft now repeat Sony's mistake?

Besides, it would give Sony and its fans yet another excuse to bash the 360 ("look, look, Microsoft is copying Sony and realized it was the right thing to do!").

This is just speculation and I can't really see any reason why MS would do it. What would they have to gain by joining with Toshiba or anyone else?
It would certainly be interesting if they did adopt this strategy. Would it mean that we'd see a Toshiba Xbox 360? The Atari 2600 and Intellivision were released in rebranded versions.

If Toshiba made the console, I would sell my current 360 in a heartbeat and buy from a company that knows how to make hardware.

I think this is a great idea for them and it would help them get their platform in non MS friendly territories (Japan and Most of Europe).

That could just be part of the deal with Toshiba...

We will license your box and sell it to show other electronic companies...

You need to start putting an HD DVD drive in though so that we are in this together for the long term...

Wouldn't be a bad idea of Toshiba re-branded the X360 and sold it exclusively in Japan...

if this rumor is true MS is really going to drop a bomb...imagine a lot of manufacturers that could integrate in their DVD recorder/dvd player/media center/electronic device a gaming console with full functionality: if this works well in the next few years we could be finding ourselves talking of "xbox compatible" like now we are speaking of "windows compatible".

BTW if this comes true it's gonna cause a big headache to ioi to track sales...