Microsoft just bought R2 Studios, a company that Apple and Google were both after, to help the Xbox continue its assault on living rooms across the world. R2 Studios, which was founded by Blake Krikorian (the guy who also made the Slingbox), apparently "works on" technology related to distributing and displaying digital media on televisions.

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Basically, it's more of Microsoft seeing the Xbox as a set top box as opposed to just a gaming device. It's also more of Microsoft flexing Xbox over Apple TV and Google TV. [WSJ]