Xbox used for games only 60 percent of the time

Microsoft's Xbox 360 is very clearly a gaming device, but as it turns out, a growing chunk of users are spending time using it for other things.

Speaking to attendees of BMO Capital Markets Digital Entertainment Conference in New York, Dennis Durkin, corporate vice president and chief operating and financial officer of Microsoft's Interactive Entertainment Business, said that 40 percent of Xbox Live members in the U.S. are spending their time on the console on non-gaming activities. That includes things like watching streaming movies on Netflix, listening to music content on the Zune and Last.fm apps, and eyeballing friends on Twitter and Facebook.

"What we found is the core gamer might be the person who brought the console into the house, but as you widen the choices of content, it broadens what people can do with the system," Durkin said.

According to Durkin, those same members are also spending an average of three hours online, per day.

Microsoft currently has some 25 million Xbox Live subscribers, half of which pay for the premium version of the service, which can be paid for in monthly allotments, or by the year. Microsoft also recently increased the cost of the paid service for the first time since its inception by 20 percent, for what was quoted by Xbox Live's marketing senior director Craig Davison to be tied to increasing costs for infrastructure and securing content.

Xbox Live wasn't the only focus of Durkin's presentation though; he also talked up the Xbox's Kinect motion sensor accessory, which hit shelves last week. Durkin did not go into specifics on sales numbers, but did say that the company has seen considerable demand. "Everything we've been shipping has been selling," he said. Citing reports by retailers like GameStop and Toys "R" Us, Durkin noted that the standalone Kinect accessory has also been sold out at most retailers, unlike the version which ships as part of a console bundle.

Durkin also hinted at some of the advertising opportunities the Kinect opens up for Microsoft and its Xbox Live platform--particularly in getting a better breakdown of who is using the console.

"It's hard to track though with a controller-based system," Durkin said. "Kinect brings a really interesting opportunity as it relates to that. Obviously with Kinect, it has facial recognition, so we can cater what content we present based on who you are."

Durkin then offered up a situation where someone in a mixed household comes to use the system and gets a different set of Marketplace content presented to them, with different ads. The same technique could be used to serve up advertisements aimed at groups, when the Kinect could tell that you were in a room full of people, Durkin said.

"Those are the kinds of things we can do when you add the sensor to the equation. There's a bunch of experiences in that."

This article was first published as a blog post on CNET News.