Microsoft Corp. announced a slimmer version of its Xbox One at USC’s Galen Center on Monday.

The new console, unveiled as the Electronic Entertainment Expo gets underway Tuesday in Los Angeles, is the smallest Xbox yet -- 40% smaller than its predecessor.

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JUNE 13, 8:18 p.m.: An earlier version of this article said the announcement occurred at the Los Angeles Convention Center. The event was held at the Galen Center.


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The system will feature a large 2-terabyte hard drive and will support 4K resolution for Blu-ray discs. Unlike its predecessor, the console will come with a stand that allows it to sit vertically. It goes on sale in August starting at $299.

The announcement came hours before rival Sony Inc. was expected to discuss an updated version of its PlayStation 4. Analysts predict the upgraded console will have improved graphics, potentially larger storage and support for 4K.

Sony has yet to announce the price for the device, but it is expected to be higher than the current Playstation 4 price of $350.


If that holds true, Microsoft may be in position to have early success in sales with its new Xbox One model.

“The price is really important here,” Mike Vorhaus, the president of Magid Advisors, a media consulting firm said.

Because these releases represent minor updates to an existing console – not entirely new platforms -- a few dollars in savings could sway consumers, he said.

“Over and over we saw that the lower-priced guy is going to sell more units in the beginning. And that’s still true,” Vorhaus said. “So Xbox lets [Microsoft] appeal to people who haven’t bought a console yet. The late adopters. And it lets them appeal to people who already bought a PS4.”


And there are plenty of those people. Sony has sold double the amount of PS4s to Microsoft’s Xbox Ones.

“It’s a tale of two different consoles,” said Andrew Alvarez, a gaming industry research analyst IBIS World. “For the Xbox it’s an attempt to press the reset button and see if the second life to this console will help increase sales.”

In an industry in which consoles must now compete with mobile devices, PCs and even virtual reality helmets, console sales have held strong despite the increasingly crowded field.

At its E3 press conference Monday, Microsoft talked about the idea of cross-platform gaming, which is the ability to play a game on a console against someone on a PC and vice-versa. It’s something that could help the industry stay competitive even as its rivals continue to grow.


“Everyone thought this generation of consoles weren’t going to sell as well as they did,” Alvarez said. “That was a huge boom. There’s a huge core demographic that still exists that’s still interested in using their consoles.”

alex.schiffer@latimes.com

UPDATES:

8:18 p.m.: This article was updated to correct a factual error.