Dean Takahashi, author of the book, Opening the Xbox, ($24.95, Prima Publishing) reports in a recent edition of Red Herring, a technology magazine, that Microsoft is developing a new version of the Xbox game console. The hybrid device not only plays video games, but it will be able to record TV programs on the device"s built-in hard disk.
Takahashi said the Xbox with digital video recorder will sell for about $500 and could be on store shelves in 2003. The Wall Street Journal and technology Web site ZDNet also have reported on the Xbox project, which is code-named "Freon." Microsoft hasn"t commented on it officially.
Takahashi also said that Microsoft"s internal estimates show the company could lose as much as $750 million on Xbox this fiscal year, which ended June 2002, and as much as $1.1 billion in the next fiscal year. It has been widely reported that Microsoft is absorbing losses on the Xbox hardware in the hopes its software sales will drive future revenue.