Microsoft Prices Next-Gen Xbox One at $499

Robyn Beck | AFP | Getty Images

Microsoft has its head in the cloud with Xbox One.

The company focused on how cloud computing will make games for its next-generation Xbox One console more immersive during its Monday presentation at the Electronic Entertainment Expo (E3). Microsoft announced last week that the console must be connected to the Internet every 24 hours to operate and that, ideally, the system would always be online.

"The platform features and capabilities of Xbox One allow developers to push the boundaries of creativity and push the genre in new directions," Phil Harrison, Microsoft's vice president, told the crowd at University of Southern California's Galen Center.

The upcoming console's cloud-computing capabilities were demonstrated by fleshing out dense environments in third-person, open-world games such as the zombie-fighting sequel "Dead Rising 3" and the over-the-top cartoony shooter "Sunset Overdrive."

The racing simulator "Forza Motorsport5" introduced a feature called "drivatar," which mimics players' driving styles and allows their drivatars to play for them offline.

"It's about delivering real human behavior," said Creative Director Dan Greenawalt at Turn 10 Studios, developer of "Forza Motorsport."

Microsoft announced Monday that the console, which it debuted earlier this year at its headquarters in Redmond, Wash., will be released in November and cost $499.

Other games showcased Monday that are coming to Xbox One included the historical third-person game "Ryse: Son of Rome," hard-knuckled brawler "Killer Instinct," a bigger edition of "Minecraft," terra-forming simulator "Project Spark" and a new installment of the sci-fi shooter "Halo."

Monday's flashy event concluded with the debut of the multiplayer shooter "Titanfall," the first game from Respawn Entertainment. It was founded by Vince Zampella and Jason West, creators of "Call of Duty: Modern Warfare."

Microsoft didn't address concerns over connectivity, used games and privacy issues with the Xbox One, which will feature a new version of its camera-based Kinect sensor. In a blog post on Microsoft's site last week before E3, the company outlined more details about the console, including that there would be restrictions on how previously played or used games could be shared.

Microsoft kicked off Monday's presentation by revealing the Xbox 360 is getting a makeover with a design inspired by the Xbox One.

Yusuf Mehdi, Microsoft's vice president of marketing and strategy, said the updated Xbox 360 is "smaller, sleeker and as quiet as ever." He added it would be available beginning Monday.

The company boasted that hundreds of new games are still coming to Xbox 360, which was originally released eight years ago as the high-definition successor to the Xbox. Microsoft's Xbox 360 has outsold rivals such as Nintendo's Wii and Sony's PlayStation 3 for the past two years.