Microsoft Takes a Shot at Apple and Nintendo

Microsoft (Nasdaq: MSFT  ) keeps thinking outside the box with its Xbox.

At the annual E3 videogame conference in the City of Angels, the software giant took the wraps off of one of its new tricks, and it looks rather enticing. The new technology is called SmartGlass, and it takes cues from Apple's (Nasdaq: AAPL  ) AirPlay wireless streaming capabilities as well as console gaming rival Nintendo's (OTC: NTDOY.PK) new Wii U, which the Japanese gaming giant also outlined in further detail at the conference.

Take that, Apple!
The Mac maker unveiled its AirPlay system nearly two years ago as a wireless protocol that allowed a user to stream audio and video content directly from a device over Wi-Fi to a compatible accessory, such as its Apple TV or ones offered by third-party manufacturers.

Source: Apple. AirPlay.

Source: Apple. AirPlay.

Apple has continued to build out the functionality across its product families, and it's a prominent selling feature for the iPhone, iPad, and Apple TV set-top box as a powerful combination.

Microsoft is looking to pursue the same seamless experience with SmartGlass, and one of the features is that users can beam content directly from other devices like a Windows 8 smartphone or tablet straight to the TV through the Xbox 360.

Source: Microsoft. SmartGlass.

Source: Microsoft. SmartGlass.

That's not all SmartGlass will be able to do, though.

Take that, Nintendo!
Nintendo's next big hardware push with the Wii U uses a larger gamepad controller that sports a big touchscreen at its heart, along with many of the other standard buttons and joysticks that gamers are familiar with. Interestingly, the device looks very much like a tablet with gaming hardware buttons tagging along for the ride.

Source: Nintendo. Wii U.

Source: Nintendo. Wii U.

The idea behind Wii U is using the secondary display to augment the game experience, displaying additional information to supplement the content on the big screen. Nintendo demoed the ability to look around an immersive world through the Wii U controller, with the secondary screen acting like a window.

Microsoft's SmartGlass will similarly use secondary displays to augment the experience by serving up relevant content to a video or game. Microsoft gaming exec Don Mattrick demoed watching Game of Thrones while a tablet displayed additional details about what was taking place up top.

Mattrick added, "We all go into our living room and have a touch surface like a phone or a tablet, but it has no idea what's occurring on the TV." SmartGlass aims to change that by connecting all of those devices together. Microsoft has been working on the technology for about a year.

Everyone's invited!
Instead of keeping it all in the family, Microsoft is inviting iOS and Google (Nasdaq: GOOG  ) Android devices to the party, so the features will be available to a wide user base beyond the paltry Windows Phone segment of the market.

This new offering combines the best of AirPlay and the Wii U. Microsoft is in a unique position as one of the few players that can link together all these devices. Nintendo hasn't disclosed any pricing details on the Wii U, but I'd imagine the cost of extra controllers will be rather pricey considering how much hardware goes into them, while Microsoft is able to tap into the existing installed base of iOS, Android, and WP mobile devices.

Sony's (NYSE: SNE  ) PlayStation 3 doesn't offer this type of functionality either, despite the fact that it makes a handful of Android phones that aren't particularly popular. Even on those devices, Google is responsible for the operating system, while in contrast Microsoft owns the whole experience and is able to include OS-level integration.

Integration time
Microsoft's recent initiatives are downright impressive, and this is coming from an admitted Apple loyalist. Windows 8 looks like a very promising tablet OS that will probably beat Android's underwhelming tablet performance in the market. The software giant continues to teach the Xbox more and more tricks in a preemptive assault on the living room before Apple's rumored full-blown TV set arrives, even as Apple has made it clear that it hopes to tap into AirPlay for its own gaming capabilities that could threaten the Xbox.

Leveraging its leading position in console gaming to lead a broader entertainment push is a smart move. So is taking a page out of Apple's playbook and integrating all of these devices together to serve up a cohesive user experience.

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Fool contributor Evan Niu owns shares of Apple, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Apple, Google, and Microsoft. Motley Fool newsletter services have recommended buying shares of Google, Apple, Nintendo, and Microsoft and creating bull call spread positions in Apple and Microsoft. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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