Microsoft is breaking up with the Consumer Electronics Show.

The tech giant has announced via a company blog that this year's keynote and exhibit booth will be its last at the show – a notable departure, since the company's keynote has long been the unofficial kickoff to CES.

"We have decided that this coming January will be our last keynote presentation and booth at CES," said Frank Shaw, Microsoft's vice president of corporate communications. "We’ll continue to participate in CES as a great place to connect with partners and customers across the PC, phone and entertainment industries, but we won’t have a keynote or booth after this year because our product news milestones generally don’t align with the show’s January timing."

It's hardly a devastating blow to the show, which still has the support of television manufacturers and more, but combined with Apple's boycotting of CES, Microsoft's decision to bow out will create a notable hole in the computer/tablet space.

Microsoft continues to roll out new entertainment offerings for the Xbox 360.

The second wave of content providers for the recent user interface revamp of Xbox Live has hit the console, bringing some familiar names. Starting today, U.S. users will be able to access content from ClearChannel's streaming radio service iHeartRadio and Verizon FiOS customers will be able to access a limited selection of live channels.

Also joining the fun is YouTube, TMZ and MSNBC.com.

Verizon's FiOS customers will be able to watch up 26 live TV channels, including MTV, Spike, Food Network, Comedy Central, HBO, CNN and Nickelodeon. In order to use the services, Xbox Live users must prove they are subscribers to the cablers or satcasters, or in Bravo or Syfy's case, confirm that they are paying cable or satellite customers.

Other countries are getting different channels. Here's the complete list.

* blinkbox. United Kingdom

* iHeartRadio. United States

* MSN Video. Australia, Canada, Germany, Italy, Mexico, United Kingdom

* MSNBC.com. United States

* MUZU.TV. Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Spain, Sweden, United Kingdom

* Rogers On Demand (Rogers Media). Canada

* SBS ON DEMAND. Australia

* TMZ (Warner Bros.). Canada, United States

* RTVE (RTVE.es). Spain

* Verizon FiOS TV. United States

* YouTube. Available in 24 countries globally

Microsoft, which tried unsuccessfully to acquire Yahoo in 2008, is thinking about making another run at the company. This time, though, a merger of the two companies could impact the entertainment landscape.

To be clear: There's no offer at this point and there's apparently a lot of internal debate about whether to make one at Microsoft headquarters these days. And, technically, Yahoo hasn't announced it's for sale – though it has been talking quietly with potential bidders.

Reuters, which initially reported Microsoft's renewed interest in Yahoo!, notes other bidders for the company include Providence Equity Partners, Hellman & Friedman and Silver Lake Partners, as well as Chinese e-commerce giant Alibaba and Russian technology investment firm DST Global.

Were Microsoft and Yahoo to come together, though, things are notably different than they were three years ago. Yahoo has invested heavily in original content in that time. Just this week, in fact, the company unveiled plans for eight new Web-based shows targeted at women. That will bring the count up to 26.

Microsoft, meanwhile, has been focusing on distributing content, especially through its Xbox 360 console. (Earlier today, the company announced its lineup of 40 programming partners to stream live TV and VOD programs through the system.)

Yahoo's original content might help the Xbox broaden its appeal to women and give it a leg up in original content for the Xbox, an area Sony has been exploring on the PlayStation 3 with reality fare such as The Tester.

Couldn't get a ticket to this weekend's iHeartRadio Music Festival in Las Vegas? That doesn't mean you can't watch it.

The Clear Channel-sponsored mega-concert will be streamed in high definition exclusively on Microsoft's Xbox 360, giving gamers (and their families) the chance to see the acts perform live.

The concerts, which will feature Lady Gaga, Jay-Z, Coldplay, Kenny Chesney, The Black Eyed Peas, Steven Tyler, Alicia Keys, Jennifer Lopez, Carrie Underwood, Rascal Flatts, Bruno Mars, Kelly, Usher, Sting and Jeff Beck (among others), will take place this Friday and Saturday. Tickets to the show sold out in 10 minutes.

The concert will also be audio streamed.

“This partnership with Xbox 360 means that those who cannot be in Las Vegas in person will have the opportunity to experience the event as well through an HD video stream exclusively on Xbox LIVE,” said John Hogan, president and CEO of Clear Channel.

The collection of big apps is meant to promote the company's iHeartRadio app, which is designed to take back audience from services like Pandora and Spotify by offering easy access to over 800 terrestrial and digital-only stations via the iPod and iPhone.

This is the droid you're looking for if you're a "Star Wars"-loving gamer.

Microsoft has unveiled a new "Star Wars"-branded Xbox 360 – with a console body that looks like R2-D2 and a C-3PO gold colored controller – that will go on sale this holiday season.

Priced at $450, the bundle will also include a white Kinect camera and a copy of the forthcoming "Kinect Star Wars" game. The presentation is one of several tie-ins to the just starting San Diego Comic Con. The company also plans to show off a new podracing mode for the game at the show as well.

Things are going well at Microsoft's Xbox division these days. The company, in its just released Q4 earnings, noted that the Entertainment & Devices Division saw a 30 percent jump in revenue during the quarter, a 45 percent increase over the previous year. Strong sales of the Xbox 360 and Kinect get the credit.

On the whole, Microsoft boasted quarterly revenue of $17.37 billion -- up eight percent over the same period last year and setting a new record in the process. Net income came in at $5.87 billion, a 30 percent improvement over the previous year. For fiscal 2011, revenues of $69.94 billion broke another record, coming in 12 percent higher than fiscal 2010.

Having established partnerships with both Netflix and Hulu on the Xbox 360, Microsoft might be gearing up to compete with them.

The company is reportedly planning to roll out a streaming video service of its own under the Zune brand later this year.

The Daily – Rupert Murdoch's daily iPad newspaper – reports that Microsoft is tired of seeing other subscription services earning money that it could potentially pocket, which is prompting the move. But it's a little light on details – such as whether the service will carry an additional charge or be folded into the current Zune monthly fee of $15.

It's also possible it could be folded into the annual Xbox Live service fee. Microsoft did recently raise that from $50 to $60, giving it a little more wiggle room to add features.

Microsoft declined comment, based on its policy of not commenting on "rumors or speculation”.

At present, Xbox Live users can download videos from the Zune service for an a la carte fee to watch them – something fewer and fewer people are doing, as streaming becomes more widely adopted.

40 percent of all Xbox activity is spent on activities other than games. The average console is used 30 hours per week for streamed video and audio programming – and the number is growing fast.

At E3 this year, Microsoft announced plans to begin streaming Live TV through the Xbox 360, but failed to give many details – including who it planned to target as partners.

"We're reaching out across the board with everyone," says Dennis Durkin, chief operating officer and chief financial officer for Microsoft's Interactive Entertainment Business. "Content partners have seen what we've done with Canal Plus and they want to see how they can leverage our infrastructure. … We'd like to see more live TV and local TV. We're doing everything we can to strike those partnerships."

Granted, E3 is a video game trade show, but in between all the talk about Kinect and "Gears of War 3" at its pre-show press conference this year, expect Microsoft to have plenty to say about the non-gaming world.

The Xbox 360 has been a leader in general entertainment among the major consoles – but other devices, particularly Sony's PlayStation 3, have been playing a good game of catch up. A recent statement by the company's VP of corporate communications, however, indicates the company is hoping to ready to jump back out in front.

"[AT E3,] we’re continuing to deliver mind-blowing gaming experiences, and we are turning up the heat on a whole new era of home entertainment," wrote Frank Shaw on the company's blog.

These days 40 percent of all Xbox activity is spent on activities other than games, says Shaw. The average console is used 30 hours per week for streamed movies and other video programming as well as game videos – and the number is growing fast.

"The vision for Xbox is straightforward: All of the entertainment you want," he says.
"With the people you care about. Made easy. That is why you’ve seen us invest in partnerships with ESPN, Netflix and Hulu. … That is why you’ll see Xbox marketed more as an entertainment brand this year. And that is why we’re investing so much in Natural User Interface technologies (speech, touch, gestures) to make the entertainment experience that much easier—and more fun."

There have been plenty of rumors, but nothing concrete. Is Microsoft finally ready to unveil its own TV channel? Or is this the Xbox app store the company has been reumored to be quietly developing? We'll learn more next week. 

When Conan O’Brien and NBC parted ways in early 2010, the talk show host had a lot of suitors. Most were the usual suspects – Fox, Comedy Central, HBO… but when word leaked out that Microsoft was interested, it caught a few people off guard.

Reports at the time said the company was considering launching its own programming channel for the Xbox 360 – and was interested in lassoing O’Brien as the tentpole. Neither party ever talked about the discussions publicly – or even confirmed them – but last month at CES, Jeff Ross, executive producer of “Conan” finally gave some details during the “Hollywood Creative Masters” Super Session.

(Apologies for taking this long to get the story up – it’s hard to take notes when you moderate the panel, which I did in this case. Afterward, it took me a while to chase down a recording of the event.)

Ross said that while the offer was interesting, there were a couple of things working against it. Primarily, the ideas weren’t concrete enough – or something that would immediately result in work. And ultimately, when television offers began to roll in, Conan & crew decided that was the industry in which they wanted to remain.

“The Xbox thing – a lot of the conversations were ‘well, it’s a show, but it’s not a show and there are no breaks, but maybe there are breaks and it’s not 60 minutes, it’s this…’ and nobody really knew what it was,” he said. “So it was really going to be a leap of faith to jump in with these guys and figure something out which we didn’t know. Plus there were 100 people who were out of jobs and that didn’t bode well for that.”

Ultimately, though, Ross thinks Microsoft might become an interesting part of the content landscape, saying the stuff they were developing was “mind blowing.”

“I think it’s coming and it’s big,” he said. “It’s just that we weren’t in a position at that point to figure out what it was.”

As Microsoft gets people used to the idea of controlling their Xbox 360 with Kinect, its hot selling motion sensor peripheral, the company behind that technology is aiming at a bigger market.

PrimeSense Ltd, which built the technology behind Kinect, says it expects at least one U.S. cable company to release a product this year allowing subscribers to change channels, access video on demand and more through hand gestures.

The report, from Light Reading Cable, adds that tests are already underway with cable companies – and operators are testing cameras that could be attached to existing set-top boxes via USB.

"2011 will be a year where multiple operators around the globe, including the U.S., will launch programs and start to bring to market solutions, and in 2012 we will go to mass quantity," PrimeSense EVP of Business Development Uzi Breier told the publication.

The expansion, should it happen, would be a big sign of support for motion sensing tech, but it still feels a bit early for this to go widespread. Kinect has been a massive hit, selling 8 million units in the last two months of 2010, but the technology is far from perfect. Rewinding and fast forwarding films with the tech is already possible, but it’s substantially easier to use a standard remote control.

TV audiences, who often want the channel changed in a second or less, might not be happy with the lag and delay associated with the technology in its current state.

You probably knew Microsoft’s Xbox Live was big – but now the company has revealed just how impactful Xbox Live has become.

Dennis Durkin, CEO of the Interactive Entertainment Division at Microsoft, announced this week that 50 percent of Xbox Live users – some 12.5 million people - pay for a “gold” account – which runs $60 per year.

That’s $750 million per year in added revenue for the company – a number that’s sure to make Sony jealous. That user base is an active one, as well – a quick look at the “Halo: Reach” numbers will prove that. Within the first four days that title was available, players spent 953 man years playing online.