According to Eurogamer.net.
Bill Gates talked about the Xbox2 in a French newspaper interview. So it will happen regardless to the sales of the first Xbox. But then again Bill Gates did kill off Microsoft Bob when his future wife Melinda worked on it.
"The next-generation Xbox will feature digital media capabilities such as video and photo editing in addition to games. It will also allow for Internet capabilities without the need for direct connections through Wi-Fi."
Cool it looks like they are going to put the hard drive to use besides just caching data and really big save files. Here is hoping the Xbox2 can recored TV shows TiVo style and can surf the web for porn.
When asked about how cat poop burritoes are out selling the Xbox in Japan Mr Gates replied :
"We knew it was going to be difficult, and we will continue to invest in the Xbox there."
He then added in Japanese "ALL YOUR BASE ARE BELONG TO US SO GO OUT AND BUY A XBOX!" (not really but it would be cool)
"Being a new player in this business, we're satisfied with the number two position behind Sony and ahead of Nintendo is the global console market. We think that's particularly significant because software developers have historically only supported the top two platforms. With the launch of Xbox Live, our console provides opportunities that Sony can't match right out of the box,"
You can rationalize all you want Bill but there is no way in hell that you are putting Nintendo out of business in this decade. Besides if you look at worldwide sales the top two platforms are Gameboy Advance and Playstation2 not Xbox and Gamecube. Oh and the Xbox needs a more online fighting games, a mouse and an Internet browser.
I have actually met Bill Gates when I dated a girl who worked at Microsoft. I ran into him at one of the doors and chatted with him for a minute. He is short and has a high voice.

True story (appartently) - had a friend who went to an pop culture expo. Microsoft had a huge Xbox stand and he was given a Xbox T-Shirt. He borrowed a marker, wrote 'sucks' underneath it and wore it for the rest of the expo.
He sort annoys me because he only likes Nintendo and tends to be one-sided, whereas I'm pretty much unbiased.
WOW! That is pretty harsh to say it sux. Tell your friend to not be so harsh dude. It is a good system but people resent Microsoft because they control so much ....STUFF!
By the way ....why is Windows XP frigging 300 bux?
Because if you are a Microsoft employee it costs 35 bux. They get it at cost so that is a pretty huge profit margin dont ya think?
OK, normally I have an attitude of "Bill Gates sucks" and "Bill Gates should die", but you actually met him?!?!!? Way cool!! If that happened to me, I would have no idea what to say or even how to strike up a conversation with him!! That is so awesome!!!
Microsoft XP is Free lol.
Nintendo saids they feel compfortable in 3rd place. The Nintendo Gamecube has not been successfully pirated and the sales on Gamecube games are picking up from the Nintendo 64 days.
i find myself playing Gamecube and Ps2 a lot. Xbox is just not getting my attention enough. the only thing i see in the future for it is HALO 2. everything esle seems eh or ok.
Nintendo on the other hand has games that just make you want to play. a lot of revamps and some orginals, the only thing that Nintendo is lacking is there Online game.
Sony on the other hand made the worst choice in the world. If Ps2 came with the network adapter built in. It would blow Xbox away! i can't believe they gave microsoft the online game. its a shame = (
I don't think that not having the on line adapter built in is that big of a problem for the PS2. What really sets Xbox Live apart is the fact that it is a well put together service while Sony leaves all the networking stuff up to the game developer
xbox is pathectic and microsoft are cheaters. yesterday i did research on my friends xbox, there price is 300 pounds/dollars but the 3d card and cpu, pentium3 and data storage is worth under 200(over in the uk that is). and they said the dvd player was built in!! its not. u need to buy it, or rip open a dvd enabled pc and take the harddrive out.
the ps3 coming out soon is gonna have a number of features built in, like the online capabilities, etc. also its not gonna use microsoft directx as its 3d card. no way in hell! there gonna make there own one.
What the hell are you talking about?
The Xbox is $179 in the US and £144.99 in the UK. that is the same price of the Sony PS2 except it has an built in Hard Drive.
You know the PS3 is currently in development with the Xbox2 and the Gamecube 2 so it does not matter to rant and rave about systems that do not exist yet.
If you really want to know more about what I think about the Xbox read my review
http://www.8bitjoystick.com/archives/jake_review_microsoft_xbox_video_game_system.php#001028
Also Direct X is a software API not 3d hardware