The anticipated update for the XBOX 360 is coming out really soon!

Now there are even better updates including having the Marketplace having its own blade, Windows Live Messenger integration, low-power setting when downloading stuff off XBOX Live Marketplace!

For more infomation, click here (Blog photo courtesy of Gamespot): http://www.gamespot.com/features/6168727/index.html

EDIT: Just on XBOX.COM, there's even more features!!
* The name of game in tray is now displayed in the dashboard.
* When the user is in the dashboard and an Xbox 360 game is in the console then the name of the game is displayed in the tray icon of the dashboard. If the user highlights the tray icon then achievements and gamer score are displayed for that game based on the signed in user. Xbox1 games show the name and image of the game.
* Integrated support for the new Xbox 360 text input device. Note that this device includes a new wired headset.
* Playback progress bar indicates download completion.
* Switchable aspect ratio now available during video playback (Auto to Letterbox, Zoom, Stretch, Native).
* Player and friends lists now quickly show session presence information for quick identification of users that are joinable.
* Added H.264 video support: Up to 10 Mbps peak, Baseline, Main, and High profiles with 2 channel AAC LC.
* Added MPEG-4 Part 2 video support: Up to 5 Mbps peak, Simple Profile with 2 channel AAC LC.
* Show folder hierarchy for video content played from all devices.
* Bookmarks are stored for each video that the user plays remembering the users last location in the file as well as the aspect ratio that the user choose for that file.
* Video trick modes (fast forward, rewind, chapter skip) can now be used while downloading Video Marketplace content.
* Skip forward and backward functionality has been improved to skip to the next or previous chapter. Each video is divided into 10 “chapters” allowing you to quickly skip around video content.
* The information bar that is turned on via the On Screen Display (OSD) now shows you exactly where you are in the playback of the video file. In addition it will also show for Video Marketplace content how much of the file has been downloaded and where the “chapters” exist in the file.
* Windows Media protected content (WM-DRM) can now be streamed from the PC to the console. If the WM-DRM license is missing or corrupted then a specific error message is displayed to the user. Bookmarking is also stored for protected content.
* When a user selects an item for download from Marketplace then the system will determine if there is sufficient disk space for the item and, if not, will ask the user to delete content on the HDD. The system provides a sorted by size list of videos, game trailers, demos and arcade content to aid the user in the deletion process. The same list of items are also available from within memory so that users can quickly see which items are consuming the most disk space.
* The console will block the user who attempts to download content onto a storage device that will never have the capacity to store the item without deducting any points associated with the content item.
* The screensaver is disabled when playing photos from any source

Source: http://www.xbox.com/en-US/community/news/2007/0408-im.htm

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