The Xbox One will be Microsoft's third games console after the Xbox was released in 2001 and the Xbox 360, which was released in 2005.
The new Xbox has been described as a "all-in-one" entertainment hub which will include a brand new Kinect sensor, a slightly revised controller with a redesigned D-Pad and other new features such as a blu-ray drive which isn't available in Microsoft's current games console, the Xbox 360.
"Today, we put you at the centre of a new generation in the living room," said Don Mattrick, head of Microsoft's interactive entertainment business.
"This is the beginning of a new generation of games and entertainment and a new generation of smart TV," said Yusuf Mehdi, Microsoft entertainment unit executive.
Microsoft has confirmed that it will be bringing eight brand new franchises and seven other exclusive franchises to the Xbox One within the first year of release.
Forza Motorsport 5 which is an exclusive franchise to Microsoft will launch on the same day as the Xbox One along with a new game called Quantum Break.
A release date as well as a price for the next generation console wasn't announced but Don Mattrick did confirm the Xbox One will be arriving this year. Microsoft are likely to announce a release date and price at the upcoming E3 event next month.
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