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MS Xbox Live online game hits $1 bn rev mark

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CIOL Bureau
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SAN JOSE, USA: Some analysts had predicted that the future is for gaming, and after that, many market developments have been seemingly affirming the trend.

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Microsoft’s Xbox Live online video-game service probably hit the $1 billion revenue mark for the first time in the year that just ended, said a Bloomberg report.

This growth was triggered by sales of movies, avatar accessories and extra game levels, the report said.

“About half the service’s 25 million users paid an annual fee to play games online like 'Call of Duty: Modern Warfare 2' in the year ended June 30. That would be about $600 million. Sales of products like movie and TV show downloads topped subscription revenue for the first time,” Dennis Durkin, Xbox’s chief operating officer, was quoted as saying by Bloomberg.

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The report estimated that the business generated more than $1.2 billion in sales last year, exceeding analysts’ estimates.

Intensifying the battle in the gaming market, major gaming hardware players had introduced some games recently.

After Microsoft released full-body motion-sensing Kinect, Japan's Nintendo Co Ltd unveiled a new version of its DS handheld device that can play games and show movies in 3D without glasses.

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Meanwhile, Sony introduced the 'Move', which employs a wand-like controller to double as everything from a tennis racket to a baseball bat in games - and promised up to a score of 3D titles soon for its PlayStation 3 console.

According to analysts, Microsoft made the biggest splash with a seemingly revolutionary platform that employs no controller, and a clear mandate to target casual players.

Success in online gaming is crucial for Microsoft because the other products in this unit include the barely profitable Xbox game console and mobile-phone software that’s losing ground to Apple Inc. and Google Inc.

“Xbox Live has helped sell a lot of consoles and created a lot of loyalty,” said Matt Rosoff, an analyst at Directions on Microsoft in Kirkland, Washington.

Sarah Friar, an analyst at Goldman Sachs Group Inc. in San Francisco, estimates Xbox Live had sales of $1.1 billion in the past fiscal year, up from $800 million a year earlier. Subscriptions for the premium service are $50 a year.

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