At this year's E3 Expo, Microsoft made a major annoucement in terms of new functionality for the Xbox 360.  Microsoft will release a camera that attaches to the console and allows games to be played without using a controller by using sophisticated motion capture.  Dubbed Project Natal, Microsoft is looking to revolutive how users interact with technology.  Check out the demo above.

Motion capture is not new to video games.  Several years ago Sony released the Eye Toy for Playstation aiming for similar functionality, but not near as advanced as Microsoft's version appears to be.  When Nintendo released the Wii, video games saw a major shift in using motion to control onscreen action.  However, with the Wii, you have to hold a controller.  This makes Microsoft's technology that much more promising.

All of this technology makes video games more fun and interactive, but does this technology have any practical applications?  It wouldn't be the first time video games lead the way for business applications.  Advances in distributed networking/processing for Massive Multiplayer RPGs was a precursor to cloud computing and 3D video processing gave way to the move advanced desktop functionality in Windows Vista (Aero interface) and MacOS X.

Having Microsoft behind this technology, leads one to believe that incorporating it into Windows is not too far behind.  Video games gives them a profitable platform with which to experiment and develop.  But you can imagine an interface in windows that lets you grab windows, move text with small hand motions, and turn three-dimensional cubes and graphs of data with your hands.

It might not be as far off as you think.

View more videos on Project Natal on their YouTube channel.