The battle between the Microsoft Xbox 360 and the Sony Playstation 3 began long before they came out. With people comparing specs, availability of games, features, even which has a cooler name, so it came as a surprise to most people, Wii won, without ever competing. None of it seemed to matter in front of the Nintendo Wii's revolution in gaming.
Microsoft is trying to grab a piece of its pie again, with project Natal. It is their take on the new interface of interactivity introduced by Nintendo. Except with Project Natal you dont even need to hold controllers in your hand, it manages it all with a simple camera!
This is truly a testament to what cameras can accomplish today. A great amount of detail needs to be captured so that body movements can be discerned even at a distance. Even besides that processing an image and understanding each the context of each object. Thus with Project Natal you can jump right into the game without needing any controller, instead the camera captures your body motions and uses it to control your avatar in the game.
This brings in a much deeper level of involvement than even Nintendo Wii, since instead of the contoller you have all the dimensions provided by your body, infact your body itself is like a wireless controller.