When Apple original released their 1st generation Apple TV we took a look at how the “media center” compared to others in the market. At the time we quickly realized that one of the platform’s largest competitors is Microsoft’s Xbox 360. It wasn’t long after the announcement of Apple TV that Steve Jobs declared the device a “hobby” and Apple reportedly wasn’t very impressed with their own efforts to make it into the living room.

Just a few weeks ago, Apple released a new version of their Apple TV that has less of an impact on the consumer wallet and is aimed again at finding a place for Apple in living rooms across the country. The device works seamlessly with other Apple devices and the increased ability to communicate between PC, Phone, Tablet, and TV is a strong pitch from Apple to the consumer markets. The second generation Apple TV is reportedly selling at a mores successful rate than its predecessor but the device still has considerable competition in the market. While many will quickly point to Google TV as the lead opponent, people shouldn’t count out Microsoft in this battle.

Microsoft Is Already In The Living Room

Both Google and Apple are trying to make room for themselves in the living rooms of individuals around the world, but they are a bit late to the game. Its been almost 10 years since Microsoft announced their efforts into American Homes with their Xbox gaming platform. They’ve had a lot of growing pains over the years and have learned a lot of lessons, but they have achieved success in the market. In fact, its believed that over 30 million Xbox 360s have been sold with a high percentage of those devices being connected to yearly Xbox Live subscriptions. Microsoft has consumers at their fingertips already, something Apple and Google will try and build over the next few years.

Microsoft isn’t standing by and watching Google and Apple release streaming video, TV show subscriptions, and movie rentals. Each Xbox 360 can connect to Xbox live and rent television shows and movies, connect to Netflix, and even watch live sports in HD through ESPN3. I’ve personally been amazed at the quality of the streaming events. I wish Apple had such an agreement with ESPN, and suspect in time they will.

Like the Apple TV, the Xbox 360 can connect to your PC or Mac and you can stream video and audio files to your Television through the device. The Xbox 360 already includes a game market (A feature many hope Apple includes with a software update to their device) and allows you to quickly interact with friends and family. Xbox Kinect will make it so you can have “Facetime” like video conversations with your friends and family through your televisions. Google TV boxes also include this functionality.

Overall, Apple is seeing some signs of early success with their Apple TV, but Google TV isn’t their only competitor. They have to face Microsoft again, and this time Microsoft has 30 million users and 10 years of experience behind it. Its going to be a difficult market to crack.