Robbie Bach, President of entertainment and devices division at Microsoft, confirmed the release of its motion-sensing Project Natal interface for Xbox 360 this year. Also, he revealed that it is in action to develop a retro gaming-themed "Game Room" virtual environment, quite similar to Sony's PlayStation Home.

However, pricing for the device is not yet known, although according to some reports it is expected to be as low as $50.

In the CES address, which began with a power outage, Microsoft CEO Steve Ballmer threw light on the new Xbox sales statistics, revealing that the company has sold 39 million Xbox 360 consoles. Also, consumers have bought some 500 million pieces of software for Xbox and Xbox 360, accounting to nat $20 billion revenue.

“Project Natal” is a technology that uses a 3D camera to track body movements and control games. Also, no controller is required and the device bends to suit the player’s needs. The device evaluates trillions of body configurations every frame, 30 times per second.

The company speculates to offer some 1,000 games within Game Room over the next three years, with updates in the games each week.

Microsoft will be introducing capability to enable users to channel paid television content directly to their PCs, via AT&T's Uverse service, to Xbox 360.