I had a long, drawn out, geeky discussion with a friend of mine yesterday regarding the new dashboard released by Microsoft for the Xbox 360 gaming console. This particular dashboard update has been a long time coming, as last year they made promises of tighter integration with the Xbox 360 Kinect and have failed to deliver thus far. In fact, the whole motion sensor casual gaming market is another post for another day.

Regardless, one of the new features released in the New Xbox 360 update is known as "cloud storage". Now those of you who have been following any of my posts lately know that I am a huge fan of cloud computing and storage – and to me, this marks the beginning of their transfer over to the new Xbox 720 system over the next couple of years.

First of all, Microsoft has already announced the possible release of the Xbox 720 in a couple of years, so really that is no secret, but what we are starting to see developed here is a tighter integration from system to system using the cloud – and if they do it right – it may be one of the greatest marketing strategies for a console transition in history. Let me elaborate.

The cloud offers the opportunity of offsite storage to a secured cloud server. On your Microsoft Xbox 360 dashboard, you can now see an option where your normal "hard drive" and "internal storage" were displayed called "cloud storage". Now what this means is you can actually store all of your saved games offsite onto a remote storage unit and access those saved games from any Xbox that has connection to the internet.

What does this mean for the Xbox 720? Well, assuming they use the latest and greatest in virtualization technology, it is very likely the new Xbox 720 will include a virtual machine running the original Xbox 360.  Since your saved games are stored on the cloud, transitioning to the new system will not mean losing all of your old saved game data for your original Xbox 360 games.

Lets take this idea a bit further. I do not think Microsoft will stop with saved games for cloud storage, in fact, it is very likely they will store personal dashboard themes and profile customizations as well such as family privacy policy, user accounts and more.

Lets not forget that Microsoft has made major strides to ensure all of your downloads and gamerscores are attached directly to your Gamertag. What does this mean? It is likely that when you log into your new system, all of your purchased downloads, gamer scores and avatar information will transition over as well. This added to the cloud storage of all your saved games sound like a pretty sweet deal when considering moving to a new system.

Of course, this theory only holds weight if Microsoft is smart enough to release the Xbox 720 with virtualization compatibility of the original Xbox 360. Given the strides that have been made in virtualization over the past five years, it really doesn't make sense not to do so. It will be a major disappointment if they decide not to, no matter how unlikely this is.

One thing Microsoft has done well is make you dependent on your gamertag, thus switching systems will seem like a chore when your decided between, say, an Xbox 720 and a Playstation 4. It means you will need to start fresh with an entirely new profile and system, often losing that emotional attachment to all of your work.

What are your thoughts on where console technology is today? Personally I think it is a very exciting time.