Microsoft ‘takes hard drive out’ of Xbox 2

Flash supplier spills the beans

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Microsoft's tie-in with Flash memory specialist M-Systems has led some observers to conclude that the software giant plans to ship its upcoming Xbox 2 console without a hard drive.

Well, that is indeed the case, if comments from M-Systems' CEO, Dov Moran, are anything to go by. Interviewed this week by Israeli business paper Globes, he said:

"Microsoft has taken the hard disk out of its Xbox. The only thing left will be a CD - that's all. At some point, when users want to save their email messages, copy music, or anything like that, the only storage they'll have is what we give them."

It's worth pointing out that this doesn't imply that the Xbox 2's hard drive will be replaced with Flash.

Moran also confirmed that Microsoft will begin manufacturing the console next year. "We'll start supply only in 2005," he said. The supply deal is worth hundreds of millions to M-Systems, He added, "spread over a few years, and we'll be the main supplier for it; and I hope the sole supplier."

If his claim correctly reflects Microsoft's Xbox 2 plan, it suggests the company wants to adopt a more console-like approach (as Xbox Next/Xbox 2 speculation has mooted previously).

It is often suggested, for example, that Xbox 2 will be a broader home entertainment system than its predecessor, providing Media Center PC-style functionality as well as gaming. The snag with this idea is that such functionality is already provided by... well, Media Center PCs, for a start. While Microsoft may want to pitch such a version of Xbox at PC-free households, any family sufficiently interested in buying such a console will almost have a PC in any case, and thus be better pitch for a higher-margin Media Center PC.

We can imagine Microsoft expanding Xbox's capabilities this way, but more as a PSX-like update to the current Xbox than the next generation of the console.

The current Xbox has a hard drive because it's essentially a PC. That's the case partly because Microsoft is wedded to the platform, but mostly because it was the cheapest way of entering the market. Using broadly off-the-shelf parts is less expensive than developing hardware from scratch. Software development is likewise less costly because it derives from a well-established platform. Much better to test the market as cheaply as possible and, if the foray proves successful, design future generations from the ground up, choosing hardware best-suited to the application in hand.

Hence the use of a non-x86 processor, IBM's 64-bit PowerPC 970 family, and the decision to drop the largely unnecessary - for most users - hard drive. Microsoft is confident that it has enough market share to bring games developers with it. And while the hardware may change radically, the software APIs almost certainly will stay the same.

This all points to a console that (like almost all of those before it) is built from the bottom up to deliver a powerful gaming experience, and not to a general-purpose personal computing device. ®

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