In the previous two parts of this sweeping review of Microsoft's latest Dashboard Update for the Xbox 360, I focused on the new Metro-style UI and Bing and Kinect functionality, respectively.  This time around, I'll focus on three more new features--Beacons, new cloud storage features, and Windows Phone integration--that are as important, in their own way, in furthering Microsoft's goal to make the console a cohesive, integrated part of a wider ecosystem of products.

Beacons

Ever since the beginning of Xbox LIVE, users have had the ability to send game invitations to friends. This is a key feature of the service, and was for a long time a prime differentiator between it and competing services, since these invitations were not limited to happening within the game you wanted to play. That is, you could send someone a game invite for "Halo 3" even if they were playing "Gears of War 2" at the time. Nice.

Microsoft extended this invite capability to Windows Phone when that platform debuted in 2010. But game invites have one crucial flaw: They're very specific. You send them to a particular contact or group of contacts, and they involve only the game you're currently playing. Microsoft extended the game invite scheme with something called Parties, allowing a group of two or more Xbox LIVE friends to "hang out" virtually and move in and out of games. But this year, in concert with the Fall 2011 Dashboard Update for the Xbox 360, the software giant has extended game invites yet again.

The new scheme is called Beacons. And it works on both the Xbox 360 and Windows Phone, though in a view-only mode on the latter.

A Beacon is a way to tell your Xbox LIVE (and, optionally, linked Facebook) friends that you're interested in playing a game or, on the console, engage in some other group activity such as watch YouTube or Netflix. It's not as specific as a game invite because it doesn't get delivered to one person or a group of people. Instead, you set a beacon. And whenever any of your friends are available on Xbox LIVE (or, optionally, on Facebook), they'll see an alert to that effect.

I've configured one beacon, for playing Call of Duty: Modern Warfare 3. And because beacons support an optional Comment field, I've added that I'm only interested in playing a game mode called Hardcore Team Deathmatch. (The default Comment is "I want to use this app with my friends".) Friends of mine have set other beacons, usually for particular games, and usually without qualification. So when Dave gets online and I'm on the console, I'll see a standard Xbox 360 notification appear, telling me that Dave would like to play "Modern Warfare 3" or "Skyrim".

That message isn't for me, per se. Instead, it's for anyone in Dave's friends list. So when he gets online and engages in an activity for which he's set a beacon, we're alerted. And if any of us want to join in, we can.

On Windows Phone, Beacons appear in the Requests screen in the Games hub. When you view these requests, you are pushed to a mobile version of the Xbox web site, where you can view information about the game or activity in question. What you can't do, for now at least, is set Beacons for Windows Phone games. You can only view Beacons from the phone.

beacon_phone2

You can also set Beacons from the Xbox web site. Just logon, click Activity from the home page, and then choose Set Beacon next to the correct activity.

beacons_web

Cloud storage

I've written in the past about the need for Xbox LIVE to allow for more portable user profiles. Microsoft responded first by adding support for removable storage in the form of USB flash drives, allowing you to move your profile (and game information) manually from console to console using one of these tiny devices. With the Fall 2011 Dashboard Update, however, Microsoft has added cloud storage to the mix. So how does this impact profiles?

From what I can tell, cloud storage is for game saves and other game information only. And Microsoft provides a paltry 512 MB of cloud storage, for now at least. This compares to the 4 GB to 16 GB that are common on Xbox 360 flash drives and 250 or 320 GB on Xbox 360 hard drives today. So it's not voluminous. But you're not storing a TV show season on there, so maybe it doesn't have to be. What we're talking about here are game saves and information. How much space could those take up?

Well, maybe not that much. After a few weeks of storing my "Modern Warfare 3" saves to the cloud, instead of to local storage, I've used up about 99 MB of space, leaving 412 MB free. And looking through the saves (in Settings, Storage, Cloud Saved Games), I've found that none of them are cloud supported anyway. (Nice of it to tell me that when it presented it as a choice in the game.)

Turns out the saves are "Game Replay Files" from multiplayer only, so maybe this wasn't the best test. Looking at the hard drive-based Modern Warfare 3 saves, I see another 106 MB taken up. This a ton of useless game replay files, but also my saved game--988 KB--a custom game mode--60 KB--and my multiplayer progress, just 68 KB. Not bad at all.

So what about my profile? This account, which has been open for ten years, amounts to just 22 MB of space, according to the console. But you can't copy or move it to the cloud, as you can between local storage devices. But that's because you don't have to: Now, in addition to using a portable USB flash drive--the manual approach--you can just simply download the profile to any other console. I've tested this on two Xbox 360s in my house to see how painful it would be to move back and forth between the two, and it works seamlessly. You may want to not save your password on the second console if it's at a friend's house, of course. But now this just works.

What I'd like to see, of course, is true cloud storage integration, where everything you've ever done on the console is moved to the cloud and cached, if desired, on individual consoles. But even this basic functionality is pretty good: You can very easily move between consoles and, if you've saved your game information to the cloud, pick up in a game where you left off, no matter which console you're using. This is an important change.

Windows Phone integration

In Microsoft's "three screen" vision, there's the PC (Windows), there's the living room (Xbox 360), and there's the phone (Windows Phone). When the company announced this vision, Windows Phone hadn't shipped yet, so it was more plan than reality. But in the intervening two years, Microsoft has delivered two excellent versions of Windows Phone, and it's significantly bolstered the non-gaming capabilities of the Xbox 360. And next year, it will ship Windows 8, a major desktop PC upgrade that will provide users with the cohesive, Metro-style UI found on the console and phone.

This is a big deal. So big, in fact, that's it's spawned bogus rumors, like the one about how Windows 8 will be able to play Xbox 360 games. People hear vague claims about integration between the three platforms and their minds wander, turn fanciful. Wishful thinking replaces common sense.

We'll have to wait and see what kinds of integration Windows 8 will bring, both with Windows Phone and with the Xbox 360. (Hint: It won't involve cross-compatible gaming.) But we don't need to wait and see how the company will integrate Windows Phone and the Xbox. That integration has been around since last year and, with the Fall 2011 Dashboard Update, improved a bit for this holiday season.

It's nothing profound. But Microsoft is wise to push this integration, since any hint that you can do unique things with both a Windows Phone and the Xbox 360 console can only help Windows Phone sales. Which, let's face it, need all the help they can get.

In the preexisting category, we have a few obvious items. Windows Phone shipped out of the gate with native Xbox LIVE compatibility, meaning that games developers can conform to the more stringent demands of that service and provide real Xbox LIVE games, for the first time on mobile, with Achievements, access to your Friends list and avatar, leaderboards, messages, and game invites. And, unique to Windows Phone, developers can provide Trial versions of Xbox LIVE games through the Windows Phone Marketplace.

Early promises of console/phone integration didn't bear much fruit. There were the occasional phone games that tied into console titles, such as Halo Waypoint and Crackdown 2: Project Sunburst, but not much else.

With the Fall 2011 Dashboard Update, however, Microsoft has released a separate Xbox Companion App which brings these two products much more closely together. I've already written a separate, lengthy article about the Xbox Companion App, which, yes, I do expect you to go read. But long story short, this app lets you access the digital media functionality of the console in a number of interesting ways. There's remote control functionality, of course, but also on-device information about the TV shows and movies you're browsing on the console. You can even run Bing content searches from the device and, when you find the content you're looking for, play it on the console.

And there's more coming. At Mobile World Congress in February, Microsoft showed off how an Xbox 360, the Kinect motion sensor add-on, and a Windows Phone handset could be used together in a coming generation of integrated games that would have both console and phone components. No such games are currently available, however.

But wait, there's more...

The Fall 2011 Dashboard Update's coup de grâce to the competition, if you will, is the new selection of TV and entertainment content that will put this console over the top as a digital media set-top box. Since announcing the Update in early December, a ton of content has come online. And I'll look at it in the fourth and concluding part of this review.