To coincide with the start of Comic-Con 2007 yesterday, Microsoft announced that it will lower the price of the Xbox 360 HD DVD Player to $179 on August 1st, a drop of $20. Additionally, anyone who purchases a player before September 30th will receive five free HD DVD movies. The company also unveiled new exclusive content for the Xbox Live Marketplace:

Xbox LIVE will offer “300” on demand in HD starting Aug. 14, and is working with Warner Bros. at Comic-Con on a Bringing It Home campaign featuring “300” and other Warner Bros. properties. In advance of the street date for the “Heroes: Season 1” HD DVD boxed set, Xbox LIVE members will be able to download for free the show’s pilot episode in high definition for a limited time.

When it comes to companies, there aren’t many bigger than Microsoft; they have over 75,000 employees in over 100 countries and more than $50 billion in annual revenue. While Microsoft’s product focus is definitely software, they do compete in a number of other markets such as gaming consoles, consumer hardware like mice and keyboards, and media and content such as MSNBC. Less visible is the product experimentation that goes on at Microsoft. You’re more likely to hear about Google employees tinkering with ideas and side projects (thanks to the company’s “twenty percent” time) but the fact is, Microsoft employees are a creative bunch.

You’ve likely heard all about the successful experiments. Not just the “big bets” as Gates likes to call them, or the interesting things that happen at Microsoft Research, but projects that almost never made it to market, like J. Allard’s Xbox. But what about the flops? As our exploration of Microsoft’s Internet TV initiatives proved, the company is certainly not afraid to experiment, taking the good with the bad. And Microsoft has had its fair share of bad. Let’s look now at some of the company’s more interesting “digital lifestyle” flops.

The introduction by Nintendo of the Wii Zapper and the Mario Kart Wheel at E3 today was great for gamers, but what struck me during its press conference was the fabled game company’s continued, relentless assault into our living rooms and turning everybody into gamers.

Nintendo contends this is a conclusive turning point for the video game market, the moment where video games stand alongside television, movies, and music as a staple of entertainment in our homes. A few statistics, as seen through Nintendo eyes:

A report out today by the Energy Saving Trust, predicts that by 2020, flat-screen televisions, computers and other hi-tech gadgets will use nearly half of a typical British home’s total electricity. This is in part due to the growth of single person households, along with the rising popularity of larger LCD televisions, set-top boxes, computers, games consoles and media players — all of which add to much higher energy consumption.

This a guest post by Sean Ammirati, VP of Business Development at mSpoke.

Explaining to media executives that it’s getting harder to engage an audience’s attention is like explaining rising fuel costs to the aviation industry — it just isn’t necessary. Two themes that are consistently mentioned when reviewing digital lifestyle devices are how they make it easier to multi-task and avoid ads.

However, one medium that is emerging as a great platform to deliver relevant ads to a receptive and engaged audience is video games. Advertisers are taking notice; according to research released in April by eMarketer the worldwide market for in game advertising was estimated to be over $690 million last year and growing at over 20% annually projected to almost $2 billion by 2011.

How Does it Work?

For marketers that want to reach the gaming audience there are two basic approaches:

• In Game Advertising
• Advergames

Though details are vague, the LA Times reports that AT&T is joining forces with Hollywood and the recording industry in a concerted effort to begin more aggressive policing of its network in order to prevent users from sharing pirated content, such as films and music.

Game console sales figures in Japan show Nintendo Wii outselling the PlayStation 3 by more than five to one last month, reports Reuters. While its high price is probably the key factor for the PS3’s poor sales, a lack of compelling software titles must also be to blame. In gaming history, smash-hit games are more than often the defining factor in a console’s success. Something which Sony inconveniently forgot.

Microsoft just announced a very cool new multi-touch computing product, called Surface. At first the rumors were this would be an iPhone competitor, but it’s clear now that it’s much larger (30-inch display!) and more of an environmental computer device. Using the product, people can interact with information using touch, natural gestures and physical objects. So no mouse or keyboard is required.