Bill Gates has always believed the computer should be the centerpiece of your entertainment living room. Now with the strong sales of the Xbox 360 , the push is continuing towards that goal. In addition to the high definition movie download service Microsoft launched earlier this year, you can expect an IPTV service to launch towards the end of 2007, effectively turning the video game console into a personal video recorder and multimedia device.

You’ll be able to watch live streaming broadcasts, and you can even play a game while recording a program in the background. Of course you’ll get all the usual benefits of a personal video recorder, like an on-screen program guide and the ability to pause, rewind, and fast forward through recordings.

There are no details yet on pricing and whether you’ll need to install a larger hard drive on your Xbox 360 for the service to work, although I’d imagine that you’d really want more than 20GB. Ideally being able to save content to a networked device would be best, this would allow it to seamlessly attach to already in place home networks :0

View engadget’s IPTV gallery

Xbox 360 IPTV (”Carbon”) Youtube demo: