"Because it's software, we can add new and improved XNA tools consistently, spurring continuous innovation in games. Developers won't have to wait for new silicon to enjoy the latest advances," said Dean Lester, general manager of Windows Graphics and Gaming Technologies at Microsoft. "The benefit to gamers will be dramatic leaps in production quality and gameplay for the next-generation Xbox and the next generation of Windows. And it starts today."
http://news.teamxbox.com/xbox/5578/XNA-Announced
Very interesting...