Xbox 360 does not compete with Sony or Nintendo. It is not a gaming console. It is a powerful device to deliver content online and over WiFi. Microsoft's real competition is Apple, Yahoo, and Google. Apple's movie-download service. Yahoo's retail channels. Google's - well, everything. Heck, throw Comcast and TiVo in there for good measure.
I don't really agree, but I don't really disagree either. Mostly I think it's something of an exaggeration of the situation, but I do think Microsoft's big selling point will be in the arena of downloadable content. I just don't think it's going to compete with my Tivo or iTunes anytime soon, just like my PS2 never stood a chance against my trusty Toshiba DVD player. Particularly not with the storage specs the 360 is currently listing.
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