Microsoft (NASDAQ:MSFT) announced on Tuesday that it would allow owners of its Xbox 360 video game console to access entertainment apps without an Xbox Live Gold subscription. Previously, a Gold account had been required, making the console an impractical set-top box alternative.
But with that requirement removed, the Xbox 360 could become the go-to device of cord-cutters and Internet video streamers, an attractive alternative to Apple (NASDAQ:AAPL) TV and Amazon's (NASDAQ:AMZN) Fire TV.
Microsoft wins when it comes to app selection
When it comes to video streaming apps, Microsoft's Xbox 360 is far better than Apple TV or Amazon's Fire TV -- and it isn't even close. Apple TV has 33 third-party video apps; Amazon's Fire TV has about a dozen.
Microsoft's Xbox 360 has a whopping 68, including EPIX, Encore, Fox News, MTV, Redbox Instant, and Starz -- apps not available on Apple's and Amazon's devices. To be fair, there are a few apps that Microsoft's Xbox is lacking -- Amazon's Fire TV has Showtime Anytime, for example, while Apple TV has Bloomberg and The Weather Channel.
But, overall, Microsoft's console is the best choice for Internet video addicts looking for the most entertainment options.
The Xbox 360 has deep integration with Windows PCs
Microsoft's console also has the advantage when it comes to natively streaming local video files. With Play To, a feature built into the Xbox 360, owners can easily stream any audio or video files stored on Windows PCs connected to the same network.
Apple TV has something similar in Airplay, which allows owners of Macs, iPhones, and iPads to stream video files from their device to their Apple TV. Owners of Amazon's Fire TV can purchase the Plex app, which, in conjunction with a local PC running Plex Media Server, can accomplish something similar.
But for those who lack a dedicated iDevice or do not wish to purchase Plex, the Xbox 360 offers the best choice for streaming local content.
Apple and Amazon have one huge advantage
But Apple TV and Amazon's Fire TV have one huge advantage over the Xbox 360 -- at $99, they're less expensive than Microsoft's console. Microsoft's device retails for $179. If you're willing to buy refurbished, you can get it for $129.
The Xbox 360 sells with a wireless controller, which is perfectly fine for navigating the system, but if a traditional remote is preferred, a compatible one can be purchased for another $20.
Of course, that higher price tag comes with more features -- in addition to offering access to more streaming video content, Microsoft's Xbox 360 can, as it was originally designed to do, play video games. As the Xbox 360 is now nearly a decade old, its catalog of games includes hundreds of hit titles, many of which can be purchased for just a few dollars.
Amazon's Fire TV can also play video games, but to truly take advantage of the feature, you'll need to purchase Amazon's controller -- at $40, the combined combination of a Fire TV and controller is more expensive than a refurbished Xbox 360, while offering far fewer games.
Microsoft's set-top box
Unlike many of its rivals, including Apple and Amazon, Microsoft has not officially entered the set-top box market. But its announcement on Tuesday effectively puts it right in the thick of things. Without the need to have an active Xbox Live Gold subscription, an Xbox 360 is, in many ways, a superior alternative to traditional set-top boxes.
Microsoft has made the Xbox 360 a tool for cord-cutters
By making it an attractive set-top box alternative, Microsoft's Xbox 360 could help to facilitate the next great living room revolution. You know cable's going away. But do you know how to profit? There's $2.2 trillion out there to be had. Currently, cable grabs a big piece of it. That won't last. And when cable falters, three companies are poised to benefit. Click here for their names. Hint: They're not Netflix, Google, or Apple.
Sam Mattera has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Amazon.com and Apple. It owns shares of Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.