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Microsoft built the Xbox around industry-standard PCThe term personal computer or PC has three meanings: IBM's range of PCs that led to the use of the term see IBM PC. A generic term used to describe all microcomputers (mentioned here). A generic term sometimes used to describe a computer based on IBM's or hardware in contrast to the traditionally proprietary design of nearly all other gaming consoles. It has
Although the Xbox is based on PC architecture and runs a stripped down version of the Windows 2000 kernel it incorporates restrictions designed to prevent uses not approved by Microsoft. It did not take long, however, for the hacker community to circumvent these limitations and install a customized distribution of the Linux operating system on the Xbox, thus making it usable as a fully featured PC (without eliminating its gaming and its online capabilities).
Xbox has been criticized for its large size and weight compared to other consoles, mostly due to its inclusion of a full sized hard disk drive and DVD-ROM drive. Even so, it is considerably smaller and lighter than most desktop PCs which contain similar hardware. The inside of the Xbox is also rather packed in due to the full size drives and flat motherboard. A warning in the Xbox manual that a falling Xbox "could cause serious injury" has been taken lightly by some; while the Xbox is certainly heavy enough to hurt a small child if dropped from a sufficient height (so can any other console if dropped), all controllers are equipped with break-away cables to help prevent this occurring.
Another common complaint about the system was that the original game controller design was seen as too large for some people. For the Japanese Xbox launch, a new and smaller controller was introduced, a design which was subsequently released in other markets as the "Controller S," eventually replacing the original design. Now all Xbox consoles come with a "Controller S", offically making the orginal launch controller obsolete and unsupported.
While some critics have speculated that the Xbox is Microsoft's attempt to monopolize the game console market due to heavy media critism, as of November 2004 estimates show the Xbox's share of the worldwide console market is slightly ahead of the Nintendo GameCube but is still far behind the PS2. But the Xbox has very rarely sold in Japan, due to the Japanese people's poor acceptence of an American console in Japan, which gives their rivals, Sony and Nintendo a big advantage. But, in much of Europe, the Xbox is currently ahead of the GameCube, but is still far behind the Playstation 2. What mainly helped worldwide sales of the Xbox was, ever since March 2004, Microsoft cut the price of the Xbox in several countries, such as American, England, Germany, France, and many other nations, which has substantially increased its sales outside of Japan. The Xbox has yet to return a profit for Microsoft, though this is common for a console company, this is in line with most other console marketing strategies in which the console is sold almost at cost, and profit is made on software licensing fees. Microsoft itself has predicted that it would not make a profit on the Xbox for at least three years after the console's debut.
In November 2002, Microsoft released the successful Xbox Live online gaming service, allowing people to play games with people all around the world. The milestone of 1 million subscribers was announced in July 2004.