Microsoft's Xbox 360 had great strategic direction from the start. It beat Sony's
However, consider that the nature of video games and video game systems is shifting. When Bill Gates and company pushed Microsoft into making systems early last decade, the idea was always somewhat defensive in nature; get into the living room in case computing started shifting in that direction.
Well, we now have Google
So, the time is now for Microsoft to strike and aggressively stretch the Xbox into a full-featured media platform. For example, Bing's in a trench war that can't be won against Google; engrain Bing at the center of the next Xbox and try gaining market share from a new direction. Make "Xbox 3" a combination of everything great about the idea of Google TV, but also with its compelling stand-alone games, and Microsoft's own platform for delivering media through the Zune marketplace and partnerships with ESPN and Netflix.
Everything's converging as Microsoft originally imagined, just a decade later. Microsoft's installed base at the center of video games puts it in the driver's seat and gives a new opportunity to feature search. Get aggressive with this now, Mr. Ballmer: In the two-front war with Apple and Google, here's an area where you're in the lead, whether you know it or not.
For more on Microsoft's opportunity, watch the video below: