Microsoft Xbox TV to compete with Apple

A low-cost alternative to the Xbox console is being planned by Microsoft for casual gaming and access to TV and entertainment services.

Microsoft chief Steve Ballmer unveils the Windows 8 operating system in New York. Credit: Photo: GETTY

The set-top box would aim to rival Apple TV and run the Windows 8 operating system as an "always on" device that booted in a matter of seconds.

Microsoft's hope is to ensnare the casual consumer who would not pay the full price tag for a console but might play games on their television in between streaming video and watching films or TV programmes.

Xbox TV will be available from next year but an exact date and price tag are not yet known.

A spokesman for Microsoft told The Verge: "Xbox 360 has found new ways to extend the console lifecycle by introducing controller-free experiences with Kinect and re-inventing the console with a new dashboard and new entertainment content partnerships.

"We are always thinking about what is next for our platform and how to continue to defy the lifecycle convention".

The set-top box work is part of a broader effort by Microsoft to distribute its Xbox Live services across a number of devices.

Speculation that a phone with Xbox Live services is next in the pipeline has also been rumoured, and details of a 7-inch Xbox Surface tablet that will be used for gaming were leaked in June.

More than 57.8 million Xbox consoles have been bought since their original launch in 2001.