Xbox One Will Be Sold Without Kinect and Entertainment Apps Now Free to All

Microsoft made a bold decision to sell their new console, Xbox One, bundled with the new Kinect hardware. It was a bold decision because its rival Sony decided to make their motion sensing accessory optional with their own new console Playstation 4. As a somewhat direct result, Xbox One was $100 more expensive at retail compared to the Playstation 4.

Directly or indirectly related to the sales price, Microsoft took a beating against Sony when it came to sales in the months since both consoles launched. Despite having more exclusive games and content, the Xbox One was unable to beat the Playstation 4. Then came the most anticipated exclusive game for the Xbox One, Titanfall. Despite selling reasonably well as a game, it was unable to push Xbox console sales to a point which made Xbox a clear “winner”.

Here’s Xbox’s Yusuf Mehdi and Phil Spencer with the news:

Maybe that was the turning point for Microsoft officials to think about ways to juice the unit sales. A couple of direct cost cuts were announced on the Xbox Wire blog on May 13:

  • As of June 9, Kinect will not be bundled with the Xbox One, and the sale price of the console-only SKU will be $399 (the bundled price was $499 at launch, although there have been several promotions since then to make effective price lower).
  • Also as of June, Xbox LIVE Gold membership will not be required in order to enjoy all the entertainment apps that are part of the Xbox platform. Until now, in order to use Netflix on the Xbox, you not only paid Netflix for their service, you also had to pay Microsoft an annual fee of $60 in order to “unlock” that and all other entertainment and communication apps. The latter is no longer required to access services like Netflix, Hulu, NFL and utilities such as Skype and OneDrive.

The Kinect hardware will be available as a standalone SKU in the Fall in case someone wants to add it to the Xbox One after purchasing the console.

So, who would pay for the Gold membership if all the entertainment and communication features of the Xbox are now unlocked for everyone? Well, the blog post notes all the benefits of the Gold subscription:

  • Free games with the Games With Gold program: This is a continuation of the program launched for Xbox 360 and will now be applicable to Xbox One games.
  • Exclusive discounts with the Deals With Gold program: Promised savings for Gold members up to 50-75%.
  • Online multiplayer: Like now, if you want to play online multiplayer games you will need Gold.
  • Home Gold: Share the Gold membership with everyone in the household.
  • Smart Match: Algorithmic matching of players to make multiplayer less one-sided.
  • Parties and Party Chat: Enable viewing party and chat alongside parties.
  • Game DVR Cloud Storage: Your game recordings stay in the Microsoft cloud without storage limits. This feature will be a Gold-exclusive.
  • Xbox Fitness: A great “game” that tracks your fitness and provides guidance and follow ups.

Some may argue that the entertainment unlocking was long overdue and I am one of those doing so. I could not understand how Microsoft was able to get away with it, but am happy to see they have changed their ways, regardless of the reason to do so. However, in order to be a true entertainment option for most, the Xbox needs a “lite” version for those who like the entertainment options that Xbox provides and don’t care about the gaming aspects of the console. Could this and the unbundling of the Kinect hardware be a precursor to a potential XTV? Let’s hope so.

As for the Kinect, I don’t understand the move at all. One of the biggest deals for game and app makers with the Kinect bundled is that they are assured of the Kinect being present so there is no fragmentation (well, besides Xbox 360 vs Xbox One but that’s separate). Now with Kinect becoming optional, game makers have to take that extra step to handle Kinect’s presence as well as absence and adjust the interaction models accordingly. With development resources tight, I suspect most developers will go for the lowest common denominator and program with the assumption that Kinect is absent and only add voice and gesture controls as a bonus rather than making them the core interactions. That’s a pity.

It does look like Microsoft has made it a priority, much like their situation in Windows Phone and Windows 8.x tablets, to increase the installed base of the devices before thinking about “the right thing” or “the best thing”. I somewhat understand the point of view. It is no longer the huge tanker that needed years to change course. They hear the feedback, prioritize it internally, and make the changes necessary.

Xbox features with and without Gold membership
Xbox features with and without Gold membership

As a consumer, I am happy that I have a choice of buying the console with or without Kinect and am extremely delighted to have all those apps without an annual fee.

Are you more willing to buy the console now that it is $100 cheaper? Does Kinect with its voice controls appeal to you? Do you use Xbox One to control your cable box? Let me know in the comments!

Apple Testing Television Set Prototypes

The rumors for an Apple Television seem to be all over the place these days. Today, The Wall Street Journal reports that Apple has testing “a few designs” for a large format HDTV. However, the report states that the company may not actually be building the device.

“It isn’t a formal project yet. It is still in the early stage of testing,” said one source.

The report also notes that Apple has been testing television set prototypes for a number of years and that the company tests many different prototype products that never come to market. This would suggest that a launch is not imminent and that Apple could get rid of plans to make a television set.

Apple Releases 5.1 Update for 2nd and 3rd Generation Apple TV

Apple has released a new software update for the Apple TV. The version number of the software update is 5.1 and supports the 2nd and 3rd generation Apple TV models. The release’s build number is 10A406e and the new update adds support for Shared Photo Streams, the ability to send audio content from the Apple TV to AirPlay-enabled speakers and devices (including AirPort Express and other Apple TVs), and the ability to switch between multiple iTunes accounts. It is a pretty significant update overall. Last update for the Apple TV was released in June.

Details regarding the update can be found on Apple’s website:

Shared Photo Streams – Accept invitations for Shared Photo Streams, browse photos and comments, and receive notifications of new content.

AirPlay – Send audio content from Apple TV to AirPlay-enabled speakers and devices (including AirPort Express and other Apple TVs). Also includes the ability to require an onscreen code to use AirPlay with your Apple TV.

iTunes account switching – Save multiple iTunes accounts and switch quickly between them.

Trailers – Search movie trailers. In the United States, see show times for local theaters.

Screen savers – New Cascade, Shrinking Tiles, and Sliding Panels screen savers.

Main menu – Reorder icons on the second page by holding down the select button on the remote.

Subtitles – SDH support for the deaf and hard-of-hearing as well as improvements to viewing and selecting subtitles.

Network configuration – Support for setting up advanced network options using configuration profiles. See for more information.

Stability and performance – Includes general performance and stability improvements.

Apple TV users can update their TV via the Settings menu -> then General, and then selecting Update Software.

Eddy Cue Suggests Apple Television Unlikely Without Content Deals

Rumors regarding Apple entering the television market have been around for some time. Today, Fortune highlights a new analyst report published by Pacific Crest’s Andy Hargreaves. This report was written after a meeting on Wednesday with Apple’s CFO Peter Oppenheimer and Eddy Cue, Apple’s senior vice president of Internet Software and Services.

Hargreaves’s analysis of the meeting was that Apple’s television would be “extremely unlikely” in the near term. His report would backup the recent claim that Apple was in talks with cable providers to potentially build a set-top box that would handle live TV programming. It has also been said that Apple has yet to strike a deal with any cable operators possibly due to reluctance on the part of content providers.

Relative to the television market, Eddy Cue, Apple SVP of Internet Software and Services, reiterated the company’s mantra that it will enter markets where it feels it can create great customer experiences and address key problems. The key problems in the television market are the poor quality of the user interface and the forced bundling of pay TV content, in our view. While Apple could almost certainly create a better user interface, Mr. Cue’s commentary suggested that this would be an incomplete solution from Apple’s perspective unless it could deliver content in a way that is different from the current multichannel pay TV model.

Fortune’s Philip Elmer-DeWitt notes that SEC rules prohibits sharing insider information that might have material affect on the company’s stock, which means that Hargreaves’ report is just that. His report talks about Apple delivering a “great customer experience and addressing key problems.”

Tim Cook at D10: Deflects Questions about TV, Is an Area of “Intense Interest”

At this year’s All Things D conference, Walt Mossberg and Kara Swisher interviewed Apple CEO Tim Cook on a variety of topics. MacRumors has a full transcript of the interview. One of the topics he was asked about is the Apple TV and the company’s interest in making a full fledged television set. Right now, Apple just sells a $99 version, which is a mini black box. Rumors regarding the full fledged Apple TV has been in full swing this year.

During the interview, Cook once again emphasized the small success of the current Apple TV. He revealed that the device has been selling twice the rate of the previous year with 2.7 million units sold in the first 6 months of 2012. Last year, Apple sold a little under 3 million. Cook also reported that there is incredibly high customer satisfaction with the current Apple TV set top box, and it’s an area they have intense interest in:

This is an area of intense interest for us. Many of us, the TV that we do watch, is almost exclusively on [the Apple TV]. That’s what my TV watching is. All of my movies, everything is coming through Apple TV.So, the customer satisfaction with that product is incredible. We’re going to keep pulling this string and see where it takes us. Many people would say “this is an area in their life that they aren’t pleased with.” They might not be pleased with many things about it. The whole TV experience. It’s an interesting area. We’ll have to see what we do. Right now our contribution is Apple TV.
Later on in the interview when Mossberg asked  “Are you making a television,” Cook replied that he’s not going to answer that question.
However, Cook did discuss their general approach to product design in response to Apple’s possible contribution to the television market:
We would look at this and say can we control the key technology? Can we make a significant contribution beyond what others have made in this area? Can we make a product that we would all want? That’s all thing we would ask about any new product category. It’s the ones we ask about products within families we’re thinking about now.

Apple Releases Apple TV to Version 5.0.1

Just yesterday, Apple released OS X Lion 10.7.4  the fourth maintenance update for OS X Lion. Today, Apple has released a new update for the generation 2 and 3 Apple TV models.

This update brings the ability for movies and TV show previews from the iTunes Store to be viewed in HD and fixes a few other minor bugs.

Apple TV Software Update 5.0.1

iTunes previews – Previews for movies and TV shows from the iTunes Store can now be viewed in HD.
AirPlay – Fixes an issue that caused some iOS apps to have trouble connecting via AirPlay.
Home Sharing – Improves the reliability of Home Sharing connections.
Netflix – Addresses an issue affecting Netflix login and navigation.
Stability and performance – Includes fixes for issues affecting stability and performance.

Users can update the Apple TV by going to the Settings menu, then General, then selecting Update Software.

Netflix Now Offering 1080p Streaming on New Apple TV

Earlier this morning, Apple introduced a new Apple TV. It comes with a  “streamlined new user interface” with a gorgeous 1080p UI. Unlike the 2nd gen model, the new Apple TV is also able to play back Full HD (1080p) videos. Internally, the third generation Apple TV is powered by the same A5 processor, which powers the iPhone 4S and the iPad 2. The new UI makes it easier to browse and install apps. Other notable features include the ability to recommend movies based on what you have already seen, overall faster browsing experience and others. It costs $99 and will be made available on March 16th.

Now, Netflix has announced that it will offer 1080p streaming for the new Apple TV with direct iTunes Store Account billing.

Starting today, you can sign-up for Netflix directly on your Apple TV and pay via your iTunes account. Plus, with the new third generation Apple TV, you’ll also be able to watch thousands of hours of great movies and television streaming on Netflix in 1080p high definition and with room-filling Dolby Digital 5.1 audio.

Now, with a software update on your Apple TV, this seamless sign up and billing experience extends to the second generation Apple TV. The new sign up and payment experience on Apple TV is available wherever Netflix is, including in the U.S., Canada, Latin America, the United Kingdom and Ireland.

Netflix’s iOS app is available for free on the App Store for iPhone and iPad.

Next-Generation Apple TV Announced!

While everyone was waiting for Apple to announce the next-generation iPad, the company announced the third generation Apple TV. The new Apple TV comes with a “streamlined new user interface” with a gorgeous 1080p UI. Unlike the 2nd gen, the Apple TV is also able to play back Full HD (1080p) videos.

Internally, the 3rd gen Apple TV is powered by the same A5 SoC, which powers the iPhone 4S and the iPad 2. The new UI makes it easier to browse and install apps. Other notable features include the ability to recommend movies based on what you have already seen, overall faster browsing experience and others.

The next-generation Apple TV will hit the retail stores on March 16th, and will be available for only $99. Pre-orders for the device begin from today itself!


Apple Stalls Apple TV Shipments Ahead of iPad 3 Announcement

Recently, rumors of a new Apple TV being announced on March 7th have appeared and part numbers indicating an update alongside the iPad 3 next week have been revealed.

AppleInsider now reports that Apple has specifically been stalling in delivering promised shipments of the device to resellers. In addition, Apple’s own stores are starting to see shortages of the Apple TV as the company reduces the supply ahead of the refresh. Even though the online store is still showing an “in stock” status, the customers that select the in-store pickup option will find that many Apple retail stores are currently out of stock. For locations that are currently out of stock of the Apple TV, the company can still ship orders to the stores for pickup, but even those shipments are starting to see extended timeframes.

Just yesterday, Apple sent out invites for its iPad 3 event on March 7th, and it appears that the updated Apple TV will be making an appearance at that time. If you are looking to purchase an Apple TV, I’d wait until next week.

Rumor: Roger and BCE Already Have the Apple iTV in Their Labs

It is rumored that Apple will enter the TV market big time this year by introducing a full fledged TV, which means that rumors won’t stop coming! It is the media’s new unicorn. Last year, it was rumored that the Apple TV may run on custom-built chips. Which is probably true because Apple is already using custom-built chips known as the A5 processor in the iPhone 4S and iPad 2. Apple is already a chip maker. Then in January, it was reported that Apple may or may not be interested in bidding for English Premier League Streaming rights.

Well, here comes another rumor! The Globe and Mail, which is Canada’s largest-circulation newspaper, reports that Apple is considering launch partnerships with Canada’s Rogers Communications and BCE Inc. According to the newspaper, these companies already have the Apple iTV in their labs. OK, let’s take this with a pinch of salt, shall we? When was the last time you ever heard of the most secretive company in the world ever give its products in development for testing to third parties?

“They’re not closed to doing it with one [company] or doing it with two,” said one source who is familiar with the talks. “They’re looking for a partner. They’re looking for someone with wireless and broadband capabilities.”

The report also suggests that Siri is integrated into Apple’s new television to help viewers make programming choices. Viewers can then control the TV with voice or hand gestures. Also, an on screen keyboard can be made to show up without any special hardware.

An on-screen keyboard, meanwhile, can also be activated in a similar manner, allowing viewers to surf the web, conduct video chats and use social media sites such as Twitter and Facebook – all without any physical interface.

I don’t know about you, but if Apple does enter the TV market big time this year, it will be interesting to see how they revolutionize the market. I’m excited!