Xbox Live gets a little Dis magic

Deal adds 35 HD titles available for downloading

Microsoft Corp. announced the addition of Walt Disney Co. films to the Xbox 360's download service, Xbox Live, on Tuesday night at the opening presentation of the E3 Media and Business Summit.

Jeff Bell, corporate vice president of global marketing at Microsoft, welcomed Disney to the ranks of other studios including Warner Bros. Home Entertainment, Paramount Pictures and Lionsgate currently contributing high-definition titles to the fast-growing platform.

"Xbox Live is leading the way in digital distribution," Bell told attendees at the Santa Monica High School Ampitheater, citing $125 million in sales from downloadable content since launch.

There was no shortage of showmanship for the E3 opener. Highlights included Bell introducing upcoming "Madden NFL 08" by inviting New Orleans Saints star Reggie Bush on stage to help test-drive the game. Other new titles unveiled included "Mass Effect," which will be released in November by Microsoft Game Studios.

Among the 35 Disney titles that will be made available beginning Tuesday are "The Queen" and "Deja Vu." More titles are expected to be added in the coming months.

But Xbox still has some catching up to do in the Disney department compared with Apple's iTunes, which has a broader array of Disney films on tap as well as bigger titles, including "Pirates of the Caribbean: At World's End."

That might have something to do with tight ties between Apple and Disney ally Pixar, which was not included in the Xbox deal.

Bell reported robust numbers for Xbox Live, which recently surpassed 7 million members. He projected reaching 10 million by this time next year.

All in all, Xbox Live now has 2,000 titles from 28 networks and TV studios, including 500 hours of HD programming.

Contrary to expectations that Microsoft would lower the price of Xbox in response to a similar move made this week by Sony Corp. for its PlayStation 3 console, Microsoft did not announce such a move but didn't rule it out as an option.

"July is the worst month to do something like that," said Robbie Bach, president of the entertainment and devices division at Microsoft, said in a interview preceding the news conference. "It's the slowest time in every market in the world. We'll decide what we'll do in the future when we get there."

Bach sought to bolster Xbox's image in the wake of a disclosure this week that Microsoft would spend more than $1 billion to repair technical problems experienced by some owners of the console as well as extend warranties.

He noted that 11.6 million Xbox 360 consoles have been sold, 5.6 million in the U.S. In addition, Bach said that Xbox owners buy more games per console than owners of Nintendo or Sony devices. "When you look at the dollars spent on the consoles, we're dramatically ahead of our individual competitors," he said. "That's important for the marketplace because more publishers will want to develop more games."

Bach also touted Xbox's competitive advantage for the 2007 holiday season, noting that Microsoft will have the only console that can service the probable three biggest sellers out at that time: "Halo 3," "Madden NFL 08" and "Grand Theft Auto IV."

"We think we have the best lineup of games in history," Bach said.

While Xbox has established itself as a console of choice for hardcore gamers, Bach signaled that Microsoft will take several steps to make it more accessible to a broader audience, including a set of new casual games for Xbox Live Arcade and a deal with DVD game brand Scene It? that will bring a customized new controller to the console.

In addition, Bell announced that Xbox Live would begin offering HD video downloads later this fall in Canada as well as Europe, where Microsoft will also begin selling Xbox 360 Elite to allow consumers to store more digital content.

Also among Tuesday's announcements, Sierra Online announced three new titles joining Xbox Live Arcade, including one based on Sci Fi Channel series "Battlestar Galactica."