Microsoft on Friday releases its Xbox One game console, taking on Sony's PlayStation 4 in a battle for the hearts and minds of Internet-era home entertainment.
Sony last week unleashed its new champion in the long-running console war, getting a slight jump on Microsoft heading into the prime holiday shopping season.
The Xbox One, successor to the Xbox 360, the top-selling console in North America, will debut at a price of $500 while Sony's PS4 is priced at $400.
Sony said it sold more than a million PS4 consoles in the 24 hours after its release on November 15, but the debut was marred by complaints by a small percentage of buyers of units malfunctioning.
Analysts said that it remained to be seen which of the new-generation consoles will prove more popular, noting that the lower price plays in favor of the PS4.
"If history has anything to say about it, core gamers tend to favor Sony," said Brian Blau, research director at analyst firm Gartner.
"There is nothing I've seen to say that one platform is going to have an advantage over the other."
Both consoles boast upgrades which provide richer graphics and more immersive game play than their predecessors. Social features of online play have also been enhanced, along with the ability to share with friends.
Microsoft touts the Xbox One console as a home entertainment hub that goes far beyond games.
The beefed-up hardware allows for instant switching between games, television, and Internet browsing. Microsoft-owned Skype was integrated for online group video calls.
Kinect motion and sound sensing accessories accompanying the consoles recognize users; respond instantly to commands spoken in natural language, and even detect a person's pulse.
"This is the beginning of a new generation of games and entertainment and a new generation of smart TV," Microsoft entertainment unit executive Yusuf Mehdi said when Xbox One was unveiled.
Mehdi maintained that a strong selling point is that Kinect devices, which were sold as Xbox 360 accessories, will be included with Xbox One consoles.
Microsoft has put its hardware and software mastery to effective use, bringing game controllers, tablets, smartphones, voice, and gesture together in the Xbox One.
In a move that might irk gamers, neither Xbox One or PS4 are compatible with titles designed for play on earlier versions of consoles.
Mehdi was not worried about the booming popularity of play on smartphones and tablet computers, saying it has increased the appetite for interactive entertainment in what has grown to a $93 billion industry, including sales of software and hardware for consoles, PCs and handheld devices.
Research firm Gartner forecast that the console segment of the video game market will grow from $44 billion this year to $49 billion, while that of mobile games will climb from about $13 billion to $17 billion.
"Microsoft and Sony have greatly improved products," Blau said.
"The key for them is getting developers to build compelling games and applications that take advantage of all the wonderful resources that come in those boxes."
Microsoft and Sony both worked hard with blockbuster game makers to have titles ready to hit the market along with the new consoles.
While much is made of rivalry between Microsoft and Sony the evolution of consoles into digital home entertainment systems means competition from devices such as Roku boxes or even Google's inexpensive Chromecast gadget for easily streaming Internet content to television screens.
"The real competition for both console makers may be (TV box) Roku and Chromecast as digital consumers consider taking a pass on the relatively expensive next-gen consoles in favor of low-risk, high-return streaming devices," said Forrester analyst James McQuivey.
Smartphones and tablet computers have become popular platforms for play, with many games available free.
"It is very narrow minded to say that it is Sony versus Microsoft versus Nintendo," Blau said of the battle between the console titans for the hearts of gamers.
The stakes in the console game are heightened for Microsoft because Xbox has been a hit while the US-based technology colossus has seen other forays into consumer electronics flop.
Xbox One will be rolled out in 13 countries, including the US, Britain and Australia, on November 22.
Explore further: Sony sells more than a million PS4 consoles in debut