Last week the Internet was abuzz with Microsoft’s intentions to buy Israeli motion and depth sensor company, 3DV Systems. Microsoft’s offer of $35 million is below the $38.6 million invested in the company and seems to come out of desperation on the part of Kleiner Perkins. If the deal goes through, Microsoft will integrate the technology into its Xbox gaming system, making the need for any type of controller unnecessary and posing the biggest threat to Nintendo Wii yet.¬†

A little over a year ago in January 2008, 3DV stole the spotlight at the Consumer Electronics Show in Las Vegas with its new release at the time, the ZCam. The camera, which detects motion and depth, was on display for conference attendees to try out and drew a lot of good feedback. After reading about 3DV’s performance and its competitor, another Israeli company, Prime Sense’s presence at CES 2008, I predicted in a post about them that they could take gaming to the next level, including one of them becoming the next big gaming console.

Though that certainly doesn’t look like it will be the case for 3DV as an independent entity, should the deal go through with Microsoft and it is succesfully integrated into the Xbox, it looks like it will take gaming to the next level. ¬†This story will be interesting to watch as it develops and long after.