The new, black and improved Xbox 360 Elite console only comes with HDMI version 1.2, and not 1.3 as sported by the Sony PlayStation 3. That means the Xbox 360 Elite isn't compatible with high definition surround sound formats Dolby TrueHD and DTS-HD Master Audio.

While this is bound to be a disappoinment to more audiophile Xbox 360 fans, the overwhelming majority are unlikely to be affected.

The Microsoft Xbox 360 Elite also comes with a 120GB hard disk and besides the HDMI issue, the PlayStation 3-challenger has just one problem: it's only available in the US initially, though a summer Euro launch is likely.

Microsoft hasn't yet made any mention of its European launch details, but we don't expect it to have. The corporation has clearly decided not to meet the PlayStation 3 Blu-ray juggernaut head-on - there's no HD DVD drive inside the Elite, although the DVD drive is capable of upscaling current discs. We've reported elsewhere about the effect this will have on the industry.

Lack of HD DVD drive

Despite the lack of a built-in HD DVD drive, Microsoft is talking up the 1080p HD capability of the new box. "Today's games and entertainment enthusiast has an insatiable appetite for digital high-definition content," claims Microsoft's Peter Moore, corporate vice president for the Interactive Entertainment Business at Microsoft.

"[The] Xbox 360 Elite's larger hard drive... will allow our community to enjoy all that the next generation of entertainment has to offer."

The souped-up 360 also ships with a wireless controller and headset. Hell, you even get an HDMI cable. It will available in US stores from 29 April, with a price tag of $479.99 (£245). A 120GB hard drive will be sold as an add-on for older Xboxes at a $179.99 (£92) price point. A black version of the Xbox 360 battery pack will also be available.

Microsoft announced at CES 2007 that IPTV will be able to be accessed via the 360, while it has always been keen to talk up its virtues as a Media Center Extender device. The addition of HDMI strengthens the appeal for digital home.