Microsoft did not provide details about the pricing of the Xbox 360 HD DVD drive, but it clarified that it will only play movies and not games. During the CES Keynote, Microsoft's Peter Moore announced the device: "The new drive will offer millions of Xbox 360 owners the ability to easily enjoy HD DVD movies and will provide consumers with even more choices for experiencing high-definition content, in either physical or digital form."
Moore also got the chance to release some pretty positive sales numbers for the Xbox 360. According to Moore, Microsoft is on track to sell between 4.5 and 5.5 million units by the end of June, and can boast a ratio of four games and three accessories purchased with each 360 unit. Microsoft barely scraped out 1 million units before year's end in a three-territory launch and could have sold millions more if the consoles were available. Also highlighted was the fact that while only 10% of Xboxes were ever connected to Xbox Live, 50% of Xbox 360 units are now running online.
Also announced was a promise of 20 games on Xbox Live Arcade by the end of March, including Capcom's classic arcade game Street Fighter 2, as well as 50 HD games for the 360 by the end of June. The keynote ended in a demo of EA's Fight Night Round 3, with Gates helming Ali and Steve Balmer piloting Fraiser. The game looked hot on the giant stage screen, and despite some billionaire-trash-talking, Gates managed to kick Balmer's ass. Before the 360 segment had concluded, Microsoft announced a playable demo of the game was available on Xbox Live Marketplace. Fight Night Round 3 is due to ship on Xbox 360, Xbox, and PS2 February 21.
Microsoft also made inroads with MTV ith its new Urge digital music service, which uses Windows Media Player 11 and accesses more than 2 million songs from major and independent labels in addition to MTV content. Expect this service to connect with Xbox 360 sometime in the future.