REDMOND, Wash. (USA TODAY) - Now representing Microsoft in the next round of the video game battle: Xbox One.

Thesoftware giant introduced the successor to the Xbox 360 at an industryevent at its headquarters here Tuesday. While it didn't mention a priceor exact release date, the Xbox One is expected to join the SonyPlayStation 4 in stores this holiday season.

A renewal of theMicrosoft and Sony rivalry will energize the global $27 billion consolegame industry, says Wedbush Securities analyst Michael Pachter. "Gamershave become fatigued, and they are ready for something different.Publishers have been reluctant to launch new (intellectual properties)late in the cycle, so there is a lot of fresh content ready for the nextgeneration," he says.

Nintendo's Wii U system, launched lastNovember "is a flop so far, and that opens up the playing field forMicrosoft and Sony to gain share," he says. Last week, Electronic Artsannounced that it would no longer be supporting the Wii U. Thatdecision, says Pachter, "is probably only the first of many similardecisions by third parties, but everyone will support the next Xbox andPlayStation."

What is clear is that Microsoft hopes to expand itsdominance in living rooms with the Xbox One. In addition to cutting-edgevideo games, the new system will have larger on-demand movie and TVlibraries, bolstered Internet features including Skype video calling andincreased control of live TV programming. The new system also aims tocapitalize on emerging consumer acceptance of smart TV and socialtelevision experiences with improved online networking while viewing.

Adding to the lustre: A new TV series based on the Halovideo games with Steven Spielberg as executive producer is in theworks. And a new deal with the National Football League will result inSurface tables on sidelines and real-time interactive video, stats anddata delivered split-screen during broadcasts.

"There is moreentertainment flooding into the living room than ever before, deliveredthrough a sea of devices," said Don Mattrick, president of Microsoft'sinteractive entertainment business. "We designed Xbox One to be thefirst all-in-one device that puts you at the center of it all-makinggames, TV, and entertainment better and easier to enjoy."

Includedwith each Xbox One will be an upgraded Kinect controller, which tracksvoice and gestures with its built-in camera, microphone and infrareddetector. Pay TV subscribers can connect their settop box and let the TVprogramming flow through the system and be controlled by Kinect's voiceand gesture monitoring.

"We're making the proposition to gamersand developers alike that you can assume every single box has voice andgesture capability and (developers can) build applications on top ofthat," says Yusuf Mehdi, corporate vice president of marketing, strategyand business for Microsoft's interactive entertainment business. "Weknow that the way people enjoy entertainment in their living room isgoing to change a lot over the next ten years. ... We are architecting(the system) for the living room of 21st century."

Rumors had thesystem named "Infinity," including a Blu-ray Disc drive and requiring analways-on Internet connection. Xbox One does have the Blu-ray drive,but the always-on aspect was unaddressed.

Microsoft sold 76million Xbox 360 systems worldwide since bringing it to market in 2005;that's slightly more than Sony's PS3 (74 million) but short ofNintendo's Wii (99 million). The designers behind the new system havetried to build this successor for an equally long life. "We believe ournext console will be a 'must-have' product for anyone who wants to takethe entertainment experiences they love and make them decidedly better,"Mattrick said."By expanding beyond just the best game experiences tothe best TV and entertainment experiences, the value proposition andmarket for Xbox becomes significantly greater and as a result willcontinue to drive growth in the overall industry.

The new systemwill build on current smart TV features found in sets from Samsung andother makers that customize TV menus for each member of the family. Butthe new Xbox One will "remember the things you did before, watching TVor playing games," Mehdi says, "and start to tailor content around you. ...When you walk up and say, 'Xbox On,' it will automatically recognizeyou and give you your own personalized customized home screen."

XboxLive, which has 48 million members, will evolve beyond online gaming tofoster social TV "moments" during special events such as the AcademyAwards or major sports events, he says. "The whole idea is get to apremium single box that can do the best of games and entertainment inone system."

Top video game publishers were on site pledging support for the new system. Activision debuted the first footage from Call of Duty: Ghosts. And EA Sports previewed its lineup of games including new Madden, NBA Live, FIFA and UFC releases.

Toprepare for the increased computing power in Microsoft's new system -as well as Sony's PS4 - EA Sports has created a new underlying Ignitegame engine that will transform games, says the studio head AndrewWilson. Athletes in the games - be they football or soccer players -will be drawn in real time with ten times as many animations, and fourtimes the artificial intelligence, or brains.

That means arunning back will more naturally follow a blocker and hit a hole in thedefensive line. And of course, the opposition is smarter and more agile,too. "You start to feel like these (virtual) athletes are makingdecisions based on human-like intelligence," Wilson says, and movingwith fluid, realistic motion. A running back in Madden might,"give a stutter step as he tries to anticipate where his offensive lineis and where the defensive line is going," he says.

And morefrequent, faster influx of sports data - daily performance and injuryupdates - will make athletes in the games more resemble their real-worldmodels. "Every time you boot up the game you will get players thattruly interact how they were interacting at that moment in the realworld, Wilson says.

As for Microsoft's deal with the NFL, the newmulti-year interactive TV rights deal means fans watching at home willbe able to augment live game broadcasts with interactive fantasyfootball stats, displayed side by side on screen during live NFLbroadcasts. Via Skype and Microsoft's SmartGlass apps, viewers will getadditional video, photos, stats and be able to interact with friends viasocial networks.

"We want to improve all facets of the NFLexperience for fans and the game on the field," said NFL CommissionerRoger Goodell in an email statement.

And actual NFL teams willbegin using Microsoft tablets. Two years from now, Microsoft hopes tosee coaches calling plays using Surface tablets.

Also planned:Increased integration of Skype will include fitness and education uses."The integration of Skype into the Xbox experience will allow friends tosee one another's screens (and) to talk to one another while playing,"Pachter says. "I think it's a killer app."

Details were sketchy on when the Halo TV series would arrive. But Microsoft has high hopes for the project. "The longstanding success of the Halonovels is testament to the fans' hunger for new stories and last year'slive action (online video) series 'Halo: Forward Unto Dawn' garneredenormous community support and won numerous awards," Mattrick said. "Wenow have the technology, teams and our newly-announced relationship withSteven Spielberg to bring Halo The TV Series to life in ways never before possible."

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