Microsoft told IGN this week that it has banned a number of modded Xbox 360 consoles from the Xbox Live service.

Microsoft’s spokesperson also provided a reminder to Xbox Live users thinking of modding their own consoles:

All consumers should know that piracy is illegal and that modifying their Xbox 360 console to play pirated discs violates the Xbox LIVE terms of use, will void their warranty and result in a ban from Xbox LIVE.

Although Microsoft has been especially active in banning consoles in the past week, the company also points out that its policy is ongoing, and Xbox 360 consoles found to be modded or playing pirated games may be banned at any time.

It’s 2009, and with the normal 5-year cycle of video game consoles, we should be getting hints about the Xbox 720, the PlayStation 4 and, well, whatever Nintendo’s going to do next.  But we’re not, which begins to confirm what analysts have suspected about this generation: the life span of game consoles is on the rise.

In an interview with G4TV, Microsoft’s Aaron Greeberg indicated that he expects the Xbox 360 to stick around for quite some time.

I think we absolutely have a very long life ahead of us. I think what we’re seeing this generation is that we have a console that is no longer limited by hardware. … We see a very, very long future ahead of us as we think about the platform and we’re not even thinking about the next generation at this point.

Greenberg indicates that the power of connectivity through its Xbox Live system is partially responsible for the lifespan of the Xbox 360.

I think that what we did with the New Xbox Experience, and many people said that it was essentially like launching a new console and we did that through the power of software.

Sony had made similar remarks about its PlayStation 3, but theirs seemed, in part, a defense of the console’s slow adoption compared to its competition.  Apparently the company didn’t expect its leading-edge console to really catch on until 2009-2010 anyways.

Microsoft has promised that it’s “just getting started” with the New Xbox Experience, and that more updates and goodies are on the way for the Xbox 360.

Xbox’s famous blogger Major Nelson has posted figures relating to Microsoft’s recent launch of the New Xbox Experience for Xbox 360 owners.  It seems that the update was justified for his company.

The sales of Xbox Live Arcade titles tripled during the week that the new Experience was released, with preference given to some of the Avatar-enabled titles.  Uno, which has been out for years, saw a 650% increase in downloads the day Avatar support was added.

For the week after the launch, movie downloads went up by 49% and TV show downloads went up 30%.  The New Xbox Experience brings these to the forefront, turning the Xbox 360 into a media hub. (Hey, we thought that was Sony’s thing…)

There are over 14 million users on Xbox Live.

Speaking with GamesIndustry.biz, Peter Molyneux of Lionhead hinted that his company’s Fable II may see distribution digitally, over Xbox Live.

On the matter, Molyneux was only able to say, “I think it would be a great thing for this studio to work on.”

“I can’t say anything else on it – I would be killed to death.”

Microsoft has not revealed official plans to begin distributing full games digitally, but the company could easily be preparing for it.  Xbox Live Arcade games and Netflix movies, the company has been pushing digital distribution.  With the failure of HD-DVD, which Microsoft had been backing over Blu-ray, it may be that digital distribution is the way for them to go.

Some analysts even speculated that Microsoft only backed HD-DVD in order to keep the market confused until it could introduce digital distribution as a superior option.  Fable II may be the first game to test the waters, although it’s already experienced high sales on physical media.

Sony’s PlayStation Home for its PS3 console is set to go live tomorrow, but Microsoft doesn’t feel the new service is a threat to their popular Xbox Live.

Speaking with Kotaku, an Aaron Greenberg, an Xbox 360 product manager, says that he isn’t impressed with the service:

“What Home to me feels like is Second Life for hardcore gamers … It doesn’t feel like it broadens the experience and invites people in. When they unveiled it, it seemed innovative. I think what’s happened is now here we are a couple of years later and we feel beyond that … It feels like 2005 tech in 2008″

One of the biggest points that PlayStation Home tries to make is that it’s a free service, while Xbox Live Gold members have to pay in order to play their games online.  Greenberg insists, though, that no price drops are in Xbox Live’s near future, and that the cost of Live is justified by the service:

“I think we have seen people are willing to pay for the premium experience. When they compare Live, even to Home, there is still a huge gap.”

Greenberg also insists that Xbox Live is prepared for the holidays.  The service, which experienced difficulties last Christmas after an unexpected number of people went online, has reportedly been improved since.  “We are well prepared for the type of growth we expect this holiday,” says Greenberg.

Sony has, in a rather timely manner, announced that it has hit the 14-million user mark for its PlayStation Network (PSN).  If accurate, this matches Microsoft’s current claim for Xbox Live usage.

The announcement comes the day before Microsoft releases its highly-anticipated Live Experience to Xbox 360 users.  The new system will improve interaction among players on the network, introduce player avatars and revitalize the Xbox 360’s interface.  Sony is probably hoping to dispel the common conception that its PSN is inferior to Xbox Live, which seems to be preferred by most regular gamers.

Microsoft is very excited about the new Live Experience, insisting that it represents that future of home entertainment content. “With the New Xbox Experience we will reach the next generation of Xbox owners, 25 million and beyond.” said Don Mattrick, senior VP at Microsoft. “We are at a watershed moment, backed by the largest entertainment brands, with an incredible line up of entertainment unmatched in any industry.”

As Mattrick indicated, Microsoft is approaching 25 million Xbox 360 consoles sold.  Compare that to 35 million sales for the Nintendo Wii, and 17 million for the PS3.  Although the Wii is reaching a wider audience, Microsoft is confident that it can maintain its lead over the PS3 indefinitely.

Needless to say, Microsoft has high hopes for its updates, but insists that the new Live Experience is just the beginning.  Xbox 360 players can judge for themselves tomorrow.  The new Xbox Live Experience update will begin downloading automatically on Wednesday when players sign into Xbox Live.

After the success of its lowered price, Microsoft saw its highest month of the year in September, selling 347,200 in the U.S.  The console is also making grounds in Japan and increasing quickly worldwide.

Aaron Greenberg, product manager at Microsoft, tells Kotaku, “we feel confident that we’ll outsell the PS3 this holiday season in North America and in Europe. We’ll do it on a global scale.”

The Xbox 360 is now the cheapest console on the market.  Microsoft also points out that its console sees a higher number of games sold per console than the others.

According to Greenberg, the company is also taking measures to ensure the stability of the Xbox Live service, which suffered downtime last holiday season after an “unexpected” surge of new users joined.

Microsoft has gone on record denying rumors this week that a Blu-ray player is in the works for the Xbox 360.

Microsoft says that it doesn’t need.  As told to Edge Online, “games are what drive consumers to purchase game consoles, and we remain focused on providing the largest library of blockbuster games available.”

This may seem odd when Microsoft is also gearing up to release the new Xbox Live Experience in November, which will add all sorts of new features to the Xbox 360 and Xbox Live service beyond the scope of games.

During his keynote speech at the Tokyo Game Show, Xbox Live boss John Schappert announced that the company’s planned Xbox Live Experience update will go live on November 19.

The new Live Experience system will offer a change to the Xbox 360’s interface, as well as new customizable avatars similar to the Mii characters on the Nintendo Wii.

The Xbox Live Experience will also introduce a new party system, where Xbox Live Gold members can join together to more easily communicate online, as well as join games and stream Netflix movies.

Microsoft has previously stated that some of the design and interface changes will be optional.

Schappert said in his speech that Xbox Live now has 14 million members.

The new Blu-ray player will likely be similar to the obsolete Xbox 360 HD-DVD player.

According to a report by Xbit Labs, Microsoft will be releasing an external Blu-ray player for the Xbox 360 console.

The report claims that Microsoft will sell the device within the $100-150 U.S. range in order to compete with the Sony PlayStation 3, which has a built-in Blu-ray player.

Rumours of a Blu-ray player for the Xbox 360 have been around ever since the demise of the Microsft-backed HD-DVD format, and the consequent Blu-ray victory in the format wars.  The Blu-ray device would replace the external HD-DVD player that Microsoft pulled in February 2008.

[UPDATE: Microsoft has since denied this claim.]

Microsoft has dropped the price of its Xbox 360 console in North America.  The basic Xbox 360 Arcade will now retail for $199 U.S., while the Premium and Elite consoles will sell for $299 and $399, respectively.

The company also dropped the console’s price in Japan recently.  A drop in the UK is expected soon as well.

Microsoft hopes that the new price will bring the console within reach of a larger market and raise the profile of the Xbox 360 even higher, as well as improve sales over the upcoming holiday season.

In an interview with Golem.de, Microsoft Germany’s product manager Boris Schneider-Johne said that aside from first-party titles, exclusive games are becoming less and less important.

“In the past, in the eighties and nineties, that was a major issue,” he explains. “I remember the big ‘Mario vs. Sonic’ debates. What we see today is that the influence of exclusive titles on the sales curves becomes ever smaller.”

“Given the production costs of the games, it is hardly possible for developers to commit itself exclusively to someone,” continues Schneider-Johne.  He illustrates how the console developers have a business incentive to limit themselves, but that third-party developers “like Electronic Arts or Activision can have a business model of rarely developing for a console exclusively. Therefore, the exclusive title is a little less important.”

And indeed, this is becoming more and more apparent as big-name titles abandon exclusivity.  Until Grand Theft Auto IV, the GTA series came out on PlayStation consoles first, and was only later ported to the Xbox and Windows PC platforms.  Final Fantasy XIII was set to be a PlayStation 3 exclusive, but Square Enix has since decided to “port” the game to the Xbox 360, even delaying the release to do so (although its sister title, Final Fantasy Versus XIII, is still slated as a PS3-exclusive).

A little while back, Square Enix announced that it would be releasing Final Fantasy XIII on the Xbox 360, instead of the PS3 only.

Now, it looks like the dual release will essentially be a port from one console to another. The game’s developer said at a recent Square Enix event that the Xbox 360 version won’t be developed until the PS3 version is complete.  The team doesn’t even have the Xbox 360 dev kit yet.

Square Enix also recently announced that it will release FFXIII in Japan in 2009, ruling out any hope of a release this year.  They also said a demo of the game will ship with the Blu-ray release of Advent Children next March.

Since development of the Xbox 360 version hasn’t started, though, the North American and European releases of Final Fantasy XIII will almost certainly be delayed.

There was a rash of news erupting today on the matter of Grand Theft Auto: IV. Here’s a quick summary of what went down:

• EB Games reported that the PS3 version of GTA IV was outselling the Xbox 360 version on pre-orders in Australia, causing some sites to report that the same was true in North America. UK retailer Asda, however, reported the same findings. HMV reports the opposite.
• Sam Houser at Rockstar told 1UP.com that there will be some differences in the game between the PS3 and Xbox 360 versions, mostly to do with the subtle differences in rendering between the consoles. (Which reminds us of the differences between Firefox and IE rendering.) Houser chooses the PS3 as his favorite in terms of visuals: “There’s a certain kind of softness without being blurry – some warmth to it – and then there’s a certain more clinical element to how the 360 looks.”
• Word has spread that a leaked copy of the game has popped up on the web, pointing to the complete impatience of some gamers. The leaked copy will supposedly run on Xbox 360 systems with the necessary mod chips. (Just — don’t plug that console into the Internet…)
• Some sites also leaked in-game footage. The complete intro was posted on YouTube, and quickly removed from the site.
• Sasha Grey, a porn actress, said she’d like to appear in a Grand Theft Auto game, “strapped with two MP5K’s and a black and grey skintight outfit”. Hype for GTA V, already?

Grand Theft Auto IV will be out on April 29.

Activision CEO Bobby Kotick has confirmed that Guitar Hero will expand with more instruments in future versions. The news is hardly a surprise, since Rock Band, which also features drums and vocals, has been doing quite well.

“We’ll include a lot of other instruments, vocals. It will help us expand internationally. It’s the first game we’ve had in which we can use local content and local bands.”

Activision hasn’t confirmed when they’ll be making this introduction, but a new Guitar Hero is scheduled for release at the end of 2008.

Guitar Hero has reached a milestone: In the 26 months since the first Guitar Hero title was released for the PlayStation 2, the rock-and-roll franchise has hit the $1 billion U.S. mark in its North American sales.

Activision, the game’s publisher, was quick to point out that Guitar Hero III broke sales records by both unit volume and dollar value for a single calendar year. Michael Griffith, Activision’s president and CEO, commented on the event:

“Guitar Hero is one of the biggest brands and one of the most powerful distribution platforms in all of entertainment today. Guitar Hero’s popularity with broad audiences is a confirmation that video games have become a true mass medium.”

The first Guitar Hero title hit the PlayStation 2 console in November 2005, and since then has spawned three sequels. The collective total sales is in the neighbourhood of 14 million units.

A big help to Activision in the dollar count is that each Guitar Hero title is sold both as a stand-alone disc and in a bundle with the guitar peripheral that allows gamers to rock-out in style rather than play with a standard game pad. Most Guitar Hero players have at least one guitar, while others purchased the new peripheral with each release, driving up the average dollar value of each sale.

Activision also said that in the weeks since Guitar Hero III was released, over five million add-on songs have been downloaded for the game.

Electronic Arts is planning to pay a little more attention to the soundtracks for its games. As a part of its “Trax” initiative, which has the game publisher paying more attention to in-game audio, the company plans to offer downloadable music that can be swapped with the background tunes for its games.

How useful the service will be probably depends on what console you’re playing on. The Xbox 360 already has the feature to import audio off of CDs or stream live music from a Windows PC — and both types can be played as the background music for pretty much any Xbox 360 game. In that case, it’s probably better to buy your music online or in-store so you’re not limited to playing it in your games.