Microsoft used its press conference at the E3 gaming trade show to introduce the next version of the Xbox, a high-end model called the Xbox One X and due to hit the market in November.
Key features: 4K video support, compatibility with older games, Ultra HD Blu-ray drive, 1TB of storage and what Microsoft says is 40 percent more power than any game console on the market.
What's missing: Microsoft didn't talk specifically about virtual reality, while PlayStation 4 already has a VR add-on. Microsoft does have plans for Windows Mixed Reality headsets that connect to Windows devices.
Why it matters: The game console market is of the great head-to-head battles in tech, with Microsoft and Sony the primary combatants, having left Nintendo behind.