Even though it could potentially steal sales from the PC market, in which Microsoft is so entrenched, the X-Box wouldn't be a direct threat to the software giant, as it will be based on the company's own technology. The spokesperson noted that he was not aware of any meetings between Microsoft and game developers. Yet developers say they have been meeting with Microsoft executives in Redmond on the subject of a gaming device. An internal Microsoft Web site, part of the company's corporate intranet, already exists and is dedicated to the X-Box concept, one source who has been in contact with Microsoft said. While Microsoft's console interest is real, the problem may lie in the firm's execution, analysts say.
Game developers have to be sold on the new plan.
Hardware makers also may be reluctant to sign on, as gaming consoles often incorporate expensive technology into relatively cheap boxes. The box is believed to run a hybrid of Windows NT and Windows CE, according to Richard Doherty, president of The Envisioneering Group , although sources say the hybrid OS is more related to the scaled-down Windows CE for devices. Despite Microsoft's silence, the firm's desires are slowly becoming more widely known. Microsoft's plans recently were made public by an executive of a Japanese software developer who was briefed by the company. Those numbers are coming primarily from the game console market, in which Sony has had tremendous success.