Microsoft revealed today at their E3 press conference that their dashboard will be completely redesigned in the fall, with an all new avatar system similar to that on the Wii. The fully customizable avatars, designed by Rare, can be imported into other games to be used as playable characters. New channels include the My Xbox channel, which includes games, photos and video. The friend list will now be manifested as "Community," which uses the avatars to designate whether or not a friend is signed on.
The interface looks somewhat similar to Vista Media Center in its basic structure, but with more emphasis on visuals. Also, a new "party" mode will allow an 8 person chat to be carried out regardless of where you are within the Xbox Live community. This party can also move as a group through different games in XBLA and their new Primetime feature, which has multiplayer-oriented party games. The update is expected to come in the fall. [Microsoft E3 Liveblog]