We met with Xbox executives in London yesterday for a post-E3 briefing. Since few of us had been to E3 in person (relying instead on dodgy video streams) it was a valuable opportunity to make sure we hadn’t missed any of the key messages. As far as the EMEA business is concerned, Microsoft is putting forward a positive story for the 360 in 2009, relative to other console platforms. Without revealing the numbers, according to Microsoft the 360 continues to perform well in a challenging market environment. In general it seems that demand for Nintendo’s Wii console continues to fall, and there is some evidence that Wii owners are beginning to move to the competing systems as they grow bored with the Wii’s novelty factor. Apart from seeing video demonstrations of Natal, the new user control platform, we were also treated to a work-in-progress demo of the recently announced Sky-on-Xbox service. Many details have still to be finalised, and the demo did not use live internet connectivity but was stored locally. Nevertheless, it was clear that Sky Player and Sky TV could become an extremely attractive and easy-to-use service within the Xbox NXE interface. Within the Sky “portal”, viewers will flick around the various Sky options with the standard Xbox controller, using up/down and left/right movements to navigate the horizontal/vertical pathways. One vertical could be a selection of streamed Sky channels (News, Sports News, Arts etc), including mini windows showing live TV. Another vertical might take the viewer through various Sky Player on-demand options – movies, sports, TV shows etc. I can also easily imagine that something similar to the Sky+ PVR functionality will be added at some point, using the Xbox hard drive for storage. We also discussed the impending arrival of instant-on VOD and 1080p content. Contrary to my previous comments, it now seems that 1080p streaming will be available at speeds as low as 6Mbps, in contrast to the 10Mbps we were originally told. The uncertainty over this issue suggests that there is still a fair amount of work to be done before these services are launched commercially. But there is no question that, as the current generation of consoles hits maturity with the games audience they will add ever more capability as non-gaming devices in order to sustain the life cycle to the maximum. It will be very interesting to see how Sky and Xbox develop the marketing and positioning of the 360 console as the video and television services are rolled out later this year. Twitter: twitter.com/DavidMercer_SA Client Reading: Global Digital Media Growth Slows to 2.7% in Q4 2008