The new Xbox One S starts at $300 and costs up to $400 for a 2-terabyte hard drive; the Xbox One previously started at $349. The new device supports 4K video and is about 40 percent smaller than the original model. A special edition will be available in August and standard versions will come out later this year.
Microsoft also revealed a product called Project Scorpio, a console with high-fidelity virtual reality that will be available by the end of next year. The announcements were made at E3, the Electronic Entertainment Expo, a video game trade show held annually in Los Angeles.
Microsoft is competing fiercely against Sony in the console market, which has lost some of its shine as new forms of play — such as mobile games — come to the fore, but which remains a lucrative area with a dedicated demographic of hard-core gamers. Sony has sold about 40 million PlayStation 4s, which are its latest generation of consoles, with Microsoft estimated to have sold about 21 million Xbox One consoles, according to SuperData Research.
The console makers are also trying to keep ahead of technology trends, with virtual reality regarded as a promising direction. Facebook, HTC and others have released virtual reality headsets and an early use of the technology is for games. Sony has already announced a virtual reality headset that will work with its PlayStation 4 console.