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Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times reporter Sharon Chan.

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January 5, 2009 5:00 PM

Microsoft says Xbox business had best year in its history

Posted by Benjamin J. Romano

Microsoft has closed the books on what it's calling the biggest sales year in the history of its game console business. The company has sold 28 million Xbox 360 consoles globally and now counts more than 17 million members to its Xbox Live service, which has become a highlight of the business.

Xbox 360 sales increased 58 percent from the end of 2007.

The company claimed an 8 million unit lead over Sony's PlayStation 3, up from a 5 million to 6 million unit lead before the holiday season, said Aaron Greenberg, director of product management for Xbox.

Sony, in a statement, described its holiday season as "solid" and said it has delivered "consistent growth throughout this year."

"Early internal data points to an increase of more than 130 percent of PS3 hardware sales for the holiday season (since Black Friday) and we're also seeing a growth of nearly 40 percent in total PS3 hardware sales for the calendar year," Ian Jackson, Sony Computer Entertainment America's sales vice president, said in a statement. The 130 percent growth is relative to the weeks prior to the holiday season and the figures are for Sony in America, not worldwide, a spokesperson said in e-mail.

Greenberg said Microsoft was most pleased with the performance of Xbox Live, its online entertainment network. "Consumers are really spending record revenue online over Xbox Live," he said.

Earlier this year the company announced that consumers had spent $1 billion on downloadable content -- including add-ons for games, television shows and movies -- over Xbox Live since Microsoft launched the Xbox 360.

While the company is not updating the revenue figure, it did say that online revenue increased 84 percent in 2008 vs. 2007.

"A lot of that is driven by the growth of our online offerings, and not just game content, but also entertainment like movies and TV shows," Greenberg said.

The number of active Xbox Live members also grew 70 percent to 17 million during the year.

One new Xbox Live feature, access to Netflix On Demand service, has been particularly popular since its launch in November, Greenberg said. "It proved to be a huge success for us," he said.

Note: I updated the original headline to reflect that 2008 was the best year in the history of Microsoft's game console business, not the best holiday season (though it may have been that, too).

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