Convergence is inevitable, and Microsoft would be wise to acknowledge this. Microsoft should combine the Xbox console and screen. Consoles are at the mercy of the screens we plug them into. Most screens destroy the grade, the textures look terrible. If you value your developers, customers and the experience you’re building, you should value all aspects of it. Without knowing exactly what device the user is using, you’re designing for the lowest common denominator. Anyway, that’s not the real opportunity.
They should call it Xbox 1440, it should have a 2560-by-1440 resolution display (hat-tip to Sean for that idea), it should be super simple to set up, and it should just work. One plug for power, and the rest is wireless. Controllers, internet, all wireless. They should call Netflix and Spotify, get them in as launch partners. If they’re even smarter they’ll start building something similar to OnLive. If you can stream HD movies, you should be able to stream HD games.
Microsoft should market it as an entertainment platform, so even if you’re only using one feature you’re still getting an incredible product. This way it will appeal to more than gamers. I know I’d buy it. There, product category created and owned.