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Xbox Live Brings Video Downloads to Xbox 360

Starting on Nov. 22, Xbox Live will begin making movie and television episodes available for download to Xbox 360 owners.

Making downloads available via the Xbox 360 removes the one restraint - the computer monitor - that has turned most users off to downloading movies, the New York Times explains. With the XBox 360, users can download to the console via Xbox Live, which requires a broadband internet connection, and then watch it on their television. "What makes this big is that there's no PC in the middle," explains Rob Enderle, principal analyst at the Enderle Group.

Microsoft has already secured distribution deals to rent or sell more than 1,000 hours of material from CBS, MTV Networks, Paramount, Warner Brothers and Turner Broadcasting, along with the martial arts show "Ultimate Fighting Championship." Some of these offerings will be available in high-definition video. No prices have been set, but Microsoft says they will be comparable to competitor's offerings. Apple charges $1.99 per television episode download.

Microsoft wants to eventually develop dual revenue streams for the Xbox: the sale of games for the console and the sale of downloads via Xbox Live. The business model is an interesting contrast to Apple's: Apple makes little money on iTunes downloads but makes up for it with hardware (iPod) sales; Microsoft loses money on Xbox, but hopes to profit from videogame sales and downloads.

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