It's interesting to see the component parts of the device that is at the center of Microsoft's huge undertaking (they have allotted $1 billion for the marketing of this new peripheral). This is a giant gamble by Microsoft, who are trying to capture an even bigger share of the more casual gaming market that Nintendo currently dominates with their Wii (Sony is also trying their hand at this with the launch of the Move motion controller). The major difference between the Kinect and both the Nintendo and Sony offerings though, is that there is no additional controller needed.
In terms of interaction, this is a major step forward as the gestural interface we see in our mobile and personal computing devices has now found its way into our living room. While the jury is still out over the Kinect itself, the number of people who will now have access to a gestural interface will increase incredibly. And while I'm not sure why Microsoft would jeopardize what is, in my opinion, the best thing they make, it's a gutsy move and one that continues our collective march to the future we all envisioned as kids.