While the first Xbox achieved less than respectable sales, Microsoft out-did themselves in almost every way with the xbox 360, taking a massive leap in market share, innovating tremendously in the online space and becoming yet another brand synonymous with gaming (and making Microsoft billions in the process). The 360 is currently neck and neck in sales with PS3, and won’t catch up to the Wii, so while this generation has been very successful for Xbox, potentially Xbox could be much bigger. Here are some things we think the next Xbox needs to meet that potential:

1) System-selling launch window titles. I’d suggest:

• Halo 5: Halo is Microsoft’s biggest franchise, and each time a Halo game is released millions of copies are sold along with millions of consoles, so it would only make sense to have a numbered sequel (the biggest sellers of the series) available at the launch of the next Xbox. I don’t think this is a realistic suggestion for launch though, as Halo 4 is due to be released in late 2012 and assuming the next xbox is released in late 2013 this leaves 343 industries with only a year of development time, which seems far too short, even for a team of their size and proficiency.
• New Microsoft IPs: One of Microsoft’s biggest shortcomings is the past 2 generations is the lack of first party studios, a flaw that’s amplified by its 2 rival’s excellent first party infrastructure. But next gen is looking differently as Microsoft is opening new studios left and right, including new offices in Vancouver and London. With these new studios will surely come new IPs that could be surprise hits and will be very welcome additions to Microsoft’s Halo and Forza filled library.
• Call of Duty with exclusive content: Call of Duty is one of the biggest names in gaming, and though it’s available on various platform it’s biggest on the Xbox. To offer further incentive to buy the Nextbox version Microsoft should cough up the cash to Activision to give their system some exclusive content. This could be the biggest launch title for them provided the exclusive content is substantial, and may be even more crucial than Halo 5 at making sure nextbox starts with a bang.

2) Aggressive hardware pricing: Sony is financially troubled at the moment, to put it lightly, and while a relatively small loss of say $50-100 on PS4 is totally feasible, it’s doubtful they’ll go any higher. For Microsoft, this is a great opportunity. Microsoft are doing well financially, and the Xbox brand is doing especially well, so why not take advantage of the situation? Microsoft could either release a similarly powerful system for $100 less, or a significantly more powerful system for the same price. In the short-term this would mean bigger losses, but in the long-term this would mean more market share, which comes with long-term benefits:

• A larger install base than the competition generally means more software sales if the two versions are much alike, which could give Microsoft more influence over third party publishers.
• Software is the main source of revenue for games consoles, and with more hardware out there you can sell more software.
• Domination over competition in an increasingly social medium is important; a lot of people play on what their friends play on, so they can play with their friends.

3) Continued focus on the multiplayer experience: The multiplayer experience is where Microsoft excelled this generation and what Xbox 360 is best known for. Gaming is becoming more social and more connected, so Microsoft need to continue in this direction and stay ahead of the curve.

4) Investment in streaming technology: Both Microsoft and Sony have dabbled in streaming tech on their current-gen consoles, but streaming is becoming bigger, and next generation they’re going to have to put a larger emphasis on it. Sony has already acquired Gaikai, the 2nd largest streaming service provider. Microsoft could follow in their footsteps and also buy an existing service, but I don’t think they need to. They have more experience in the online space than Sony, they have more money and more resources. They should create their own service and integrate it with XBL.

5) Kinect 2: Kinect is massive, and has led to the Xbox 360 being the system of choice for many casual gamers, in addition to it’s original hardcore players. Competition for this market is heated in the mobile space, but in the home it’s a different story. There are few home consoles with a big casual focus, and the biggest player (Nintendo) in this area will be taking a more hardcore route with their next console, the one which will be competing with nextbox, the Wii U.

Source: my brain/http://www.gamingcapacity.com/5-things-nextbox-needs-to-win-next-gen/

I think it's extremely unlikely that Halo 5 would release at launch, 343 is/was allowed some 4 years in total for Halo 4, there is no reason to think it'll be shorter for Halo 5 especially since they'll have to develop every asset from scratch for next-gen as well as a bigger than "usual" engine upgrade. :)

Fortunately I don't think it's a must for launch.

Slightly tl;dr but I think I agree.

Sad but true, because those strategies, while successful, don't align well with my personal preferences.

I want an expensive launch price for most powerful hardwate possible.

I don't care much about online and echo-systems spreading into the living-room.
(I play online a lot but I don't need a company to specifically put even more marketing and resources into it just to get some fluff Im not interested in.)

I hate the idea of streaming games from the cloud.

And I don't like Kinect.

Has to be price. Some article I read recently stated that number of gamers in US is declining and with current conditions consoles arent something a lot of people can afford. MS has the money right now to be able to lower the price and take any hits that might result in. The smartest thing they can do to secure this next-gen is keep price below the ps4 by $100.

Marketing

I guess price.

None of those, except the mystery new MS ips, could convince me to buy one at launch.
The price doesn't matter that much to me, as long as it matches the hardware.

It would be a lot easier for the 720 to win if MS announces free multiplayer and gets rid of the fixed ms points amounts.

2 easy

I think Microsoft will win the next gen quite easy. I think the USA and UK are already won, the XBox brand is massive in those markets.

It'll grow in the rest of europe and gain a much larger market share whilst they'll fail again in Japan, I don't see it mattering much. Japan is already handheld centric and I think the Home Console market will continue to shrink there.

1b isn't very important. Sony has tons a studios and spent tons of money with only a single successful ip to show for it

360 is still about 5 million behind the Wii for NA totals.  I wouldn't say Microsoft has USA won already considering they have never won the market.

Not bad, but not the things that would persuade me to buy the console. Rather hum drum suggestions, but safe ones. Of course it will do other things that will make it stand out that might be as much important as some of these.