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Microsoft chief executive Steve Ballmer said tonight that the Xbox 360 video game console has sold more than 66 million units since it was launched in 2005. In his final keynote at the Consumer Electronics Show, Ballmer said that the Xbox Live online gaming and entertainment service now has more than 40 million users, and he said Microsoft has sold more than 18 million Kinect motion-sensing systems.

Those numbers are impressive and they reflect a resurgence that the Xbox 360 has seen in the past couple of years. Nintendo’s motion-sensing Wii stole much of the excitement from the Xbox 360 after it launched in 2006, but the Wii’s novelty has worn off, and Kinect has helped rocket Microsoft to the No. 1 position in the console war during the past year. But Nintendo remains ahead in terms of total Wiis sold to date.

Microsoft said a year ago that Kinect had sold more than 10 million units, and the Xbox 360 had sold 57.6 million units as of Sept. 30. That means Microsoft sold nearly 10 million units during the fourth quarter.

Ballmer said he was proud about the progress Microsoft has made in video games and that it was a case of the company at its best, marshaling a lot of resources behind a big idea and executing over the course of a decade.

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“Did I expect this to happen 10 years ago?” Ballmer said. “I bet on this 10 years ago.”

Microsoft showed a new Kinect application where children could take a Sesame Street TV episode and integrate it into a two-way interactive playground. That application is coming later this year. Ballmer said that Kinect will now come to Windows in a couple of weeks on Feb. 1. He said the company was working with 200 companies to bring cool motion-sensing apps to the PC.

Microsoft showed off the Metro-inspired new Xbox Live user interface, which now has dozens of entertainment options. Fox will be a new partner, making its various entertainment properties available on Xbox Live. Those range from IGN to the Fox News Channel.

[Top photo credit: Sean Ludwig]

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