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Xbox to flash steel in new console war

It's like a seven-year storm: High-pressure fronts from Sony, Nintendo and Microsoft come together creating high winds and stormy seas, with the world's gamers sitting — and grinning — right in the eye of it all. Yes, the next console war is on.

Nintendo started it. Last November, the House of Mario released the quasi-next-generation Wii U console to middling results. Sony made the next move, officially announced the next PlayStation system in February, promising it for the 2013 holidays. But nobody outside of the company even knows what the device looks like, much less what it will cost.

The Internet has been devouring itself with hype and rumors about the next Xbox, but Microsoft itself has barely made a sound. Finally, on May 21, the company will reveal its game plan — and hopefully the system itself.

While it's not clear what it will be called, the three leading contenders are "Xbox Infinity," the painfully logical "Xbox 720" and the minimalist "Xbox." The rumor mill's consensus has settled around a few key features — compatibility with Blu-ray, social-media integration, revamped motion control that builds on the Xbox 360's wildly successful Kinect add-on. The system is likely to have integrated Skype video chat as well, since Microsoft owns it. Controversially, the device is also expected to feature some kind of "always-online" requirement, meaning that users will need a stable Internet connection to access both gaming and non-gaming content.

Though there has been discussion about Microsoft also building an "Xbox TV" set-top box, it seems that the company is focusing, for now, on turning the new game console into an entertainment hub, one that can connect to cable boxes, and also feature original content. Microsoft has been tight-lipped about what's coming from its first-party entertainment studio, but the very existence of such an operation shows that it wants to better compete with Amazon and Netflix, which both offer non-broadcast shows.

Stacking up
Will these new features be enough to keep Xbox competitive with its peers? Sony hasn't said much about entertainment features in its PlayStation 4. And while the company is championing social features — even adding a "Share" button into the PS4 controller — it didn't go into details of motion control. Instead, Sony is highlighting its starting line-up of AAA and indie games.

Microsoft will be talking up games as well. Activision has teased the fact that it will reveal the next title in its juggernaut "Call of Duty" franchise alongside the new Xbox. Meanwhile, rumor has it that Microsoft may have an exclusive deal with EA's upcoming "Call of Duty" rival "Titan."

Both Sony and Nintendo have larger fleets of in-house studios to turn out original and exclusive games, which could leave Microsoft scrambling to find the next "Halo." But whatever the case, experts say Microsoft has a large enough install base to court any serious console developer.

"The biggest challenge this time is that Microsoft isn't getting a head start on Sony. And the second biggest one is that they're highly likely not getting a big price advantage over Sony," Michael Pachter, a prominent game industry analyst at Wedbush Securities, told NBC News. "Their advantage last time was that Sony was a year late, and the PS3 was $200 more expensive."

In 2005, Microsoft released the Xbox 360 a year before the Wii or PlayStation 3 hit shelves. Microsoft also priced its console much lower than the PS3. That advantage kept Xbox 360 sales a nose ahead of PlayStation 3's until just last winter, when they caught up overall. Now, it sounds like both consoles are coming out at the same time — possibly even on the same week — and are likely to be priced the same.

Pachter said that the only thing that might drive the new Xbox's price higher than the PS4's would be a mandatory Kinect add-on in every box, which he thinks would bump up the cost by $50. Otherwise, he said the two devices have "similar architecture" that would make them "comparably priced."

"We don't know about the Xbox yet, but if they both have this AMD chipset — essentially the same power and the same graphics capability — then they're both spending about the same to make their boxes. What else in the box really has cost?" Pachter also thinks the systems will have "big-ass hard drives," in the 1- to 2-terabyte range.

Oh, Nintendo
Pachter said that since Microsoft and Sony make remarkably "similar products competing for similar users," he doubted that either one would best each other in any substantive way. Rather, both stand to gain from the comparative weakness of Nintendo's faltering Wii U.

Nintendo's oddball inventions haven't always been an Achilles heel. Although the Xbox 360 and PlayStation 3 sold 76 million and 77 million consoles total worldwide by December 2012, according to an IDC report, Nintendo Wii blew both its competitors out of the water with 99.84 million units sold as of March 2013. Alas, Nintendo's streak is not likely to continue.

Game exclusivity, Nintendo's strong suit, can only take a console so far. Nintendo had the strongest brands known to the game industry behind the Wii U, and industry commentators have still written it off as a failure. Just last week, a developer at DICE all but dismissed the possibility of bringing any of its new games (including the wildly popular "Battlefield" franchise and any new "Star Wars" games that will come out of EA's recent partnership with Disney) to the Wii U.

Mario and Luigi can certainly help a new console get off the ground as they have many, many times for Nintendo, but they can't carry it for five to seven years. And given the sheer silliness of the Wii U's controllers, Microsoft could easily dominant motion-controlled gaming hardware with the Kinect alone.

"It's pretty obvious that Nintendo is going to sell fewer consoles this cycle," Pachter said.

Microsoft's main competition, then, will come from Sony's PlayStation 4, and once again gamers might be split pretty evenly. "If the next cycle is 300 million consoles, and Sony and Microsoft go from selling 85 million each to 110 million each, they're gonna be pretty happy about it," Pachter said.

The main question for gamers trying to choose between the two devices will mostly likely come down to which console has more of the games they want — and more of their friends playing those games. Some people might be turned off by excessively draconian digital rights management, or wooed by better home entertainment options. But if pricing is even, the games are the thing.

Yannick LeJacq is a contributing writer for NBC News who has also covered games for Kill Screen, The Wall Street Journal and The Atlantic. You can follow him on Twitter at @YannickLeJacq and reach him by email at: