Xbox, Verizon Investigating TV Channels

Microsoft is in talks with TV networks to bring popular shows to the Xbox 360 while Verizon plans to offer Fios content to those outside its fiber optics-based coverage.

Monday brought reports that Microsoft is currently in talks with top networks to bring their TV content to the Xbox 360 here in the States. While rumors of TV programming on the gaming console isn't anything new, it's also no coincidence that reports of negotiations have sprouted following news that Silverlight is heading to the console soon.

Currently Microsoft already offers video content-- movies, TV episodes, music videos and more-- that can be purchased, rented, and streamed directly to the console. Subscription-based Netflix can be accessed with an Xbox Live Gold membership and Hulu Plus is slated as "coming soon."

But by adding actual TV channels provided by CBS, NBC, FOX and the like, owners would remain "locked" to the device. As it stands now, consumers are already spending 40-percent of their time on the device watching video. By adding real-time network TV content, consumers would no longer be required to shut down the console in order to watch their favorite shows via Time Warner, Comcast, or other cable TV providers. Microsoft would thus become one of the biggest network TV providers overnight, reaching out to over 30 million potential customers. The advertising opportunities for Microsoft and third parties would be huge.

As always, the Redmond-based company isn't confirming or denying the reports. "What I can say is Microsoft Xbox is very interested in delivering great entertainment to consumers, entertainment in the broadest sense," said Ross Honey, head of content acquisition for Xbox. "From our perspective, gaming and TV are going to coexist."

It's possible the Xbox TV service may take advantage of Verizon's new data centers located in Reston, Va., and Torrance, Calif. that were designed to deliver live video over the web as reliably as any cable company. According to David Rips, president of Verizon's new Verizon Digital Media Services division, this backbone will be open for Comcast, Hulu, Netflix or any other retailer looking to become an online multiservice operator (pay-TV provider). Verizon's Fios TV service will be the first to use the new backbone in order to offer programming to those outside its fiber optic-based coverage. Targeting advertising will be part of the initial release.

While not confirmed, we're betting Microsoft will reveal a TV channel lineup for the Xbox 360 during E3 this June.