In February of 2003, planning for the Xenon software platform began, and was headed by Microsoft VP J Allard.
At launch, the Xbox 360 was priced at US$399 and the Core System was priced at US$299.
Businessweek magazine compiled a report that estimates the total cost of components in the Xbox 360 premium bundle at US$525 at launch,[16] sans manufacturing costs, meaning that Microsoft initially lost money on every Xbox 360 system sold.
Microsoft is predicting that with the Xbox 360, a greater market share, yearly revenue through their Xbox Live service, and falling hardware costs will eventually make system sales profitable.
Xbox Live Arcade is an online service operated by Microsoft that is used to distribute arcade video games to Xbox and Xbox 360 owners. In addition to classic arcade games, the service offers some new original games as well as games from other consoles.
The console's graphical user interface is the Xbox 360 Dashboard; a tabbed interface that features four "Blades".
The Xbox 360 takes a new approach to hardware compared to its predecessor. The CPU, named Xenon-CPU (or XCPU) at Microsoft and "Waternoose" at IBM, is a custom triple-core PowerPC-based design by IBM.