The Microsoft Xbox

The Microsoft Xbox is a video game console first released on November 15, 2001 in North Americae. The Xbox was Microsoft's first independent venture into the video game console arena, after having developed the operating system and development tools for the MSX, and having collaborated with Sega in porting Windows CE to the Sega Dreamcast console. Notable launch titles for the console include Amped, Dead or Alive 3, Halo: Combat Evolved, and Oddworld: Munch's Oddysee.



The Xbox was initially developed within Microsoft by a small team which included Seamus Blackley, a game developer and high energy physicist. The rumors of a video game console being developed by Microsoft first emerged at the end of 1999 following interviews of Bill Gates. Gates said that a gaming/multimedia device was essential for multimedia convergence in the new times of digital entertainment. On 10 March 2000 the "X-box Project" was officially confirmed by Microsoft with a Press Release.

Some see the Xbox as a way to capitalize on the growing video game market, noting that the PC market growth was stagnating after the dot-com bust. According to the book Smartbomb, by Heather Chaplin and Aaron Ruby, the remarkable success of the upstart Sony PlayStation worried Microsoft in late 1990s. The growing video game market seemed to threaten the PC market which Microsoft had dominated and relied upon for most of its revenues. As well, a venture into the gaming console market would also diversify Microsoft's product line, which up to that time had been heavily concentrated into software.

Xbox presented a standardized alternative to the near-endless variety of end-user configurations on the PC. The Xbox even brought high-end gaming technology to the mainstream, sporting a top of the line GeForce 3 equivalent graphics processor, a built-in Ethernet adapter, and Dolby Digital 5.1 sound in hardware.


The Xbox launched in North America on November 15, 2001. The greatest success of the Xbox's launch games was Halo: Combat Evolved, which was critically well-received and one of the best-selling games of the year. Halo still remains the console's standout title. Other successful launch titles included NFL Fever 2002, Project Gotham Racing and Dead or Alive 3). However, the failure of several first-party games (including Fuzion Frenzy and Azurik: Rise of Perathia) damaged the initial public reputation of the Xbox.

Although it enjoyed strong third-party support from its inception, many early Xbox games did not take full advantage of its powerful hardware, with few additional features or graphical improvements to distinguish themselves from the PS2 version, and this negated one of the Xbox's main selling points. Lastly, Sony countered the Xbox by securing Playstation exclusives for highly anticipated games such as the Grand Theft Auto series and Metal Gear Solid 2: Sons of Liberty.

In 2002 and 2003, several releases helped the Xbox to gain momentum and distinguish itself from the PS2. The Xbox Live online service was launched alongside pilot titles MotoGP, MechAssault and Ghost Recon. Several best-selling and critically-acclaimed titles for the Xbox were published, such as Tom Clancy's Splinter Cell, Ninja Gaiden, and Star Wars: Knights of the Old Republic. Take-Two Interactive's exclusivity deal with Sony was amended to allow Grand Theft Auto III, Grand Theft Auto: Vice City and its sequels to be published on the Xbox. In addition, many other publishers got into the trend of releasing the Xbox version alongside the PS2 version, instead of delaying it for months.

In 2004, Halo 2 set records as highest grossing release in entertainment history as well as being a successful killer app for the online service. That year, Microsoft and Electronic Arts reached a deal which would see the latter's popular titles enabled on Xbox Live. In 2005, the long-awaited Xbox-exclusive Doom 3, Half-Life 2, and Far Cry Instincts were released.

Xbox Live

On November 15 2002 Microsoft released the Xbox Live online gaming service, allowing subscribers to play online Xbox games with (or against) other subscribers all around the world and download new content for their games to the hard drive. This online service works exclusively with broadband. 250,000 subscribers had signed on in 2 months since Live was launched. In July 2004, Microsoft announced that Xbox Live reached 1 million subscribers, and announced in July 2005 that Live had reached 2 million.

Market share

Some critics were initially concerned that the Xbox would allow Microsoft to extend its dominance of the PC software market to consoles. However, as of February 2005, estimates show the Xbox's share of the worldwide console market is only moderately ahead of the Nintendo GameCube and far behind the PlayStation 2. According to company documents, Microsoft has shipped 22 million consoles to retailers worldwide at the end of 2005. Although ahead of the GameCube's 18.5 million, this was far behind the PlayStation 2's 100 million shipped.

The Xbox has enjoyed its greatest success in North America, where an estimated 13.5 million units have been sold and where it managed for a month to outsell the PS2. In Europe, the Xbox's market share is currently ahead of the GameCube, but is still behind the PlayStation 2.

The Xbox has sold poorly in Japan mainly because Microsoft was unable to enlist enough local developers to cater to Japanese interests. The large size of the hardware itself did not endear itself to the size-sensitive Japanese consumers. It is estimated about 450,000 units have been sold in Japan.

Microsoft has invested billions of dollars into the Xbox internal documents and received back billions of dollars in sales. Overall though Xbox division has lost $4 billion from 2001 to 2005. In particular, the Xbox hardware itself is a loss leader, since the console was sold at a loss even at its debut price. The losses deepened when sales of the Xbox increased and when the price was reduced successive times to compete with PlayStation 2. Microsoft predicted that it would not make a profit on the Xbox for at least three years. This prediction turned out to be correct; Microsoft Game Studios, Microsoft's game division in charge of Xbox development, had its first profitable quarter reported in January 2005, thanks largely to the success of Halo 2. Investor relations documents says that in the end of 2005 Microsoft lost more than 1 billion dollars. The Xbox project never gave an annual profit to Microsoft according to these documents. In return for the money loss though the Xbox gained name recognization and a dedicated fan base.


The Xbox was designed to take advantage of a slowdown in the saturated PC gaming market and incorporates a built-in Ethernet adapter. Also, the console cost as much as the high-end GeForce 3 video card alone in 2001, while having comparable graphics processing power (the Xbox's NV2A graphics chipset is a derivative of the GeForce 3). Nonetheless, most of these features were not fully exploited in its first year of launch, notably the lack of Xbox Live online multiplayer.

The Xbox was the first console to incorporate a hard disk drive, used primarily for storing game saves compressed in zip archives (eliminating the need for separate memory cards) and content downloaded from Xbox Live. Most of the games also use it as a disk cache, for faster game loading times. Some games support "Custom soundtracks," another particularly unusual feature allowed by the hard drive. An Xbox owner can rip music from standard Audio CDs to the hard drive so players can use their custom soundtrack in addition to the original soundtrack of Xbox games that support such feature.

Although the Xbox is based on commodity PC hardware and runs a stripped-down version of the Windows 2000 kernel using APIs based largely on DirectX 8.1, it incorporates changes optimized for gaming uses as well as restrictions designed to prevent uses not approved by Microsoft. The Xbox does not use Windows CE due to Microsoft internal politics at the time, as well as limited support in Windows CE for DirectX.

The Xbox itself is much larger and heavier than its contemporaries. This is largely due to a bulky tray-loading DVD-ROM drive and the standard-size 3.5" hard drive. Because of this, the Xbox has found itself a target of mild derision, as gamers poke fun at it for things like a warning in the Xbox manual that a falling Xbox "could cause serious injury" to a small child or pet. However, the Xbox has also pioneered safety features, such as breakaway cables for the controllers to prevent the console from being yanked from the shelf.

The original game controller design, which was particularly large, was similarly often criticized since it was ill-suited to those with small hands. In response to these criticisms, a smaller controller was introduced for the Japanese Xbox launch. This Japanese controller (which was briefly imported by even mainstream video game store chains, such as GameStop) was subsequently released in other markets as the "Xbox Controller S", and currently all Xbox consoles come with a "Controller S", while the original controller (known as Controller "0" or "The Duke") was quietly discontinued.

Several internal hardware revisions have been made in an ongoing battle to discourage modding (hackers continually updated modchip designs in attempt to defeat them), cut manufacturing costs, and to provide a more reliable DVD-ROM drive (some of the early units' drives gave Disc Reading Errors). Microsoft extended the warranty on those first generation Xboxes that came with faulty drives and fixed them for free, unlike Sony and their first generation PS2s.

Modding the Xbox

The popularity of the Xbox inspired efforts to circumvent the built-in hardware and software security mechanisms, a practice informally known as modding.

There are now sites that offer to modify the software on Xboxes for free. Modding an Xbox in this manner voids its warranty, as it requires the disassembly of the console.

Hardware modifications


One of the main reasons that the Xbox modding community was able to thrive is that on the motherboard of the Xbox there are 12 LPC points which were used by developers for readouts when testing games. These holes allow modchips to get power and data from the motherboard, and made it possible to produce solderless adapters needing only one wire to connect to the motherboard. Another contributing factor was the Xbox's built in hard drive, which facilitated the installation of software modifications in modified Xboxes.

The original hard drive can be replaced with a larger one. Xbox games can then be copied from their DVDs to the hard disk using programs such as DVD2Xbox, PxHDDLoader, and most of the alternative dashboards; and then played directly from the hard drive. This allows the user to spare game disks from scratching and allows for faster load times. This process does require a modded Xbox using one of the alternative dashboards, and is used by scrupulous users to eliminate load times or leave their games in storage, and by unscrupulous users to play illegally copied games (see Legal Issues).

Most Xbox modding requires opening the case, which voids the Xbox's warranty. Also, most internal hardware modifications render an Xbox unable to participate in Xbox Live, which has forced many modders to use a switch that turns on and off their modifications. As of November 2004, Microsoft has implemented new ways to ban Xboxes with hard drive modifications from the Xbox Live service. One such successful use of Live to discourage modding was when the hit game Halo 2 was released, and many owners of modded consoles found out that they were permanently banned from the Xbox Live service. This resulted in the creation of On-Off switchable modchips (or add-ons) and Xbox Live friendly softmods from Xbox hacker community.


Beyond the more technical electronic modifications, it is also possible to modify the Xbox aesthetically. These modifications range from the simple, such as replacing the console's green decorative "jewel" with a custom-designed one, to the complex, such as full resprays of the Xbox's plastic casing.

Software modifications

Software modding is much less intrusive, and only involves running software exploits to trick the Xbox into running unsigned program code. This allows a user to run an alternate dashboard such as UIX, Avalaunch, Evolution-X or UnleashX and in turn makes playing original (free) homebrew games or various older games through arcade emulators (eg. MAME-X) and console game emulators (eg. FCE Ultra) possible. This is especially attractive as the Xbox is designed to output to TVs, and high-quality controllers and arcade sticks are available for it. As well, Some people actually make their own Xbox applications to run, but these usually aren't trustable.

Beyond gaming, a modded Xbox can be used as a media center with the Xbox Media Center software (XBMC) allowing the playing of DVDs without the DVD dongle/remote and streaming of music and video files from the hard drive or from another computer over a network. A modded Xbox can even be configured into a computer running Linux, FreeBSD, or Microsoft Windows CE operating systems.

Recently, the firmware to the newer optical drives was successfully hacked to allow unsigned code to play.

Legal Issues

In July 2005, a 22 year old Cambridge University graduate was convicted under the EU Copyright Directive for modifying Xboxes and selling them with an upgraded 200 GB hard drive, which was pre-loaded with 80 games. This was the first conviction of its kind in the UK. (The Directive makes it illegal to circumvent copy protection systems on hardware including video game consoles). It is the first conviction since the Directive was enacted in October 2003 in the UK. He was sentenced to 140 hours community service, ordered to pay 750 costs at a court in Caerphilly, Wales, and his computer equipment was confiscated.

An unambiguously legal way of modding the Xbox is replacing the whole motherboard to enable the installation of Linux, or other operating systems designed for PCs, without hacking any of Microsoft's copy-protection components. This effectively turns the Xbox into a standard PC, making the matter of copy protection for copyrighted Xbox games irrelevant.