E3 2010 is just around the corner and we’ve already shared our expectations for Sony and Nintendo. Next up: Microsoft.

Of the big three, Microsoft has played their cards closest to their chest. We don’t really know much in the way of big new titles that may be announced. Obviously there will be a strong focus on project Natal, but aside from Fable 3, there have been no titles confirmed to support it. We’ve seen several demonstrations, but MS has said that those demos are being used to show off the technology and are not necessarily going to be actual games. We should expect MS to open the gates at E3 and show off a ton of Natal titles as well as reveal the project’s official name. If you peruse various message boards around the internet, it’s not hard to see why this E3 will be very important for Natal. Given the lack of real titles announced, gamers already have a poor preconception of the device. If Microsoft doesn’t show off some great software, Natal will have a tough time at retail. One may argue that core gamers aren’t Natal’s target audience and I agree to a point. However, convincing the casual, Wii-owning gamer that they need Natal may prove difficult.

Natal has a lot to prove at E3.

Natal aside, Microsoft does have a handful of great games that will be on display at the show. Halo: Reach will arguably be the biggest release of the year and as it is Bungie’s last Halo title, expect them to go all out. The multiplayer beta was a big success, but it’s the campaign that I’m looking forward to seeing. We know next to nothing about the Reach campaign at this point. The storyline in the Halo games is one of the best in gaming history and has spawned several novels, a comic series and even anime shorts that flesh out the universe. Other big titles that should make an impact for Microsoft are Fable 3 and Gears of War 3. The previous two Fable titles were great games even though they may not have been everything Molyneux had promised. Seeing how Natal integrates with the game should be interesting too. As for Gears, what can we say? There has yet to be a title to eclipse the visual beauty of Epic’s two Gears of War titles. The Unreal engine is a powerhouse and the stunning visuals are backed by solid gameplay and a competitive multiplayer component.

Epic’s Unreal engine at work in Gears of War 3

The games mentioned above are great, but at E3, we like to be surprised. Are there any big surprises MS may have cooped up aside from Natal reveals? Signs point to yes. In a recent article on IGN, Editor-in-Chief Hilary Goldstein made an interesting comment which suggests that he knows something the rest of the gaming populace does not: “I can’t wait to see Halo: Reach’s campaign. Earlier this week, I was super jazzed for [redacted] and also the big announcement from [redacted] at the Microsoft press conference.” I’m rather interested in knowing what was redacted here.

Another big component to Microsoft’s E3 will be Xbox LIVE. LIVE has been one of Microsoft’s main competitive advantages over their rivals and while it remains the best overall online service, Sony is really ramping up the PSN and if Microsoft hopes to maintain their advantage, they’ll need to continue to innovate in the online space. Rumors recently circulated that Hulu may be on its way to the Xbox 360. If true, that’s a great addition and is exactly the kind of thing MS needs to be doing. Earlier there were reports that Microsoft was in talks with ESPN to bring sports content to XBL and this is another item I would really like to see become a reality. I would expect to see some cool new games announced for XBLA and also more service-oriented items that will continue to expand the functionality of LIVE.

Halo: Reach may be the biggest release of the year.

There are a few other items that seem to be cropping up here and there across the web including the rumor that MS will release a new “slim” model of the Xbox 360, roll out a new dashboard design and even release a portable, handheld system. I think, for the most part, these are all unfounded. A handheld is definitely not on the agenda for MS. With smartphones grabbing large portions of that market, a handheld system would be pointless for MS when they already have their Windows Phone 7 series rolling out. I also don’t believe the dashboard will be getting a redesign. I do think it will be updated to support Natal, but it won’t be the overhaul that the NXE was.

The slim hardware rumor is the most likely to be true. With the release of Natal, it’s not hard to imagine MS putting out a redesigned 360 to go along with it. However, I don’t really think this one will turn out to be true either. The Xbox 360 isn’t a large system to begin with and is shorter, lengthwise, than even the PS3 slim. It’s a good size as it is and fits nicely on media center shelves. I’m going to hedge my bet here and say that MS will at some point introduce a new sku with Natal built right into the system, but I don’t think we’ll see it at E3.

Microsoft already has a few big name titles on their list. If they throw in a few surprises and some solid new Xbox LIVE integrations, they could take the show even if Natal doesn’t live up to expectations. They’ll have tough competition though – this should be a fantastic E3!

Below is a recap of the Microsoft E3 2010 speculations and what I personally expect or don’t expect.

MS will not announce a portable handheld system.
We won’t see a slim Xbox 360 model.
There will not be a dashboard redesign, but it will be updated to include Natal support.
Halo: Reach and Gears of War 3 will impress.
Hulu on Xbox 360 is real.
We get a couple cool new title announcements.
Natal gets a real name and has a successful showing…fingers crossed!
I’ll just throw in a couple wild cards here: Final Fantasy XIV comes to the Xbox 360 and we see Shadow Complex 2; why not?

What do you think? Agree? Disagree? Let me know by leaving a comment with your own predictions and speculations!