Halo's mission: save Microsoft Xbox unit

By Daisuke Wakabayashi - Analysis

SEATTLE (Reuters) - The mission of Master Chief, the protagonist in the popular "Halo" trilogy of video games, is to save humanity from an army of aliens.

If that's not enough to thrust upon one person, he's got another task: rescue Microsoft Corp's (MSFT.O: Quote, Profile, Research, Stock Buzz) Xbox video game business from six years of losses and post its first-ever profit, and keep Wall Street off the backs of management.

"Halo 3" hits stores on Tuesday and Microsoft projects first-day sales of the game to eclipse the $125 million mark set by its predecessor, saying it will be the biggest opening for any entertainment product ever.

The last two "Halo" installments sold a combined 14.8 million units at more than $50 a game, turning the original Xbox into a must-have machine for many gamers and making the game extremely profitable.

This is a make-or-break year for the Xbox business. It has lost roughly $5 billion since Microsoft entered the video game console business in 2001 as a way to stem the rise of Sony Corp's (6758.T: Quote, Profile, Research, Stock Buzz) PlayStation game console.

The Xbox 360, the successor to the original Xbox, made its debut about a year ahead of other next-generation game consoles, building a lead over Sony's PlayStation 3 and Nintendo Co Ltd's (7974.OS: Quote, Profile, Research, Stock Buzz) hugely popular Wii with an installed base of more than 11.6 million units.

"This is certainly a huge game for Microsoft in order to maintain the momentum with the Xbox 360 having the lead over Sony," said Alan Davis, analyst at D.A. Davidson & Co.

Anyone who wants to play "Halo 3," a futuristic shooter game featuring a space marine called Master Chief fighting an alien army called the Covenant, will have to buy an Xbox 360, since Microsoft makes the software only for its own machine.