Published: 23.03 Europe/London, June 6, 2011

“This is the year live television comes to Xbox 360,” Microsoft VP Marc Whitten said during a keynote address at the E3 show in Los Angeles. To begin with, an agreement with YouTube will bring more video to the console, to be followed later by as yet unannounced live TV channels.

In the US, Xbox Live subscribers can already access VOD from Netflix and Hulu Plus as well as Microsoft’s Zune service, but there was surprisingly no connection to Google’s You Tube.

The press release doesn’t give away many details about the planned live TV service: “Now, Microsoft has announced its commitment to expand access to live television programming on Xbox 360 to more providers in the United States and around the world during the upcoming year. Consumers will enjoy news, sports and their favourite local channels, all just a voice command away, on Xbox 360.”

The company plans to work with, rather than compete with, traditional platforms such as cable companies. In Europe, there is already programming available in the UK (through a deal with BSkyB) and a similar one in France with Canal+. Under the French agreement, the Xbox console acts as a de facto decoder of the premium pay-TV provider. And just recently, the Russian IPTV service Beeline TV is to become available through the Xbox 360.

Earlier this year, there were already rumours around that Microsoft would enter the television business to compete with Apple and Google. But the fact that apart from YouTube no concrete deal were announced might be sign that Microsoft finds dealing with studios and broadcasters as difficult as Google and Apple. These two contenders in the connected TV space are still struggling hard to find the right business model – and the right connections.