Toshiba & Microsoft working on new entertainment Xbox
The XBOX360 is already an attractive media center extender, but it indeed lacks the built-in high-definition player and a more voluminous hard drive. Not having a native wireless interface (instead, one would need to buy a pricey add-on that plugs into the Ethernet port) is also a pain, since more and more people integrate Wi-Fi networks, more than they used to and have come to expect this functionality in everything. Righteously, too. Another thing to look forward to, imho.
Microsoft is working on a brand new Xbox that will incorporate not only a new HD DVD drive but a large hard drive and new entertainment software
the recently launched Xbox 360 HD DVD attach player is not selling well.
Microsoft failed to include a HDMI port
The new Xbox device, while allowing for extensive gaming capability, will be positioned as an entertainment hub that includes gaming and extensive wireless networking capability as well as 1080p playback. There is also talk of it including a dual HD TV tuner and EPG capability and a docking port for an MP3 player. For Toshiba, the device is critical if it is to be successful in beating Sony and the Blu-ray promoters.