Microsoft

The firm also announced another new console, Project Scorpio, which will offer virtual reality and 4K gaming.

It will be released by Christmas 2017 but no details of a price were given.

The Xbox One S, however, will cost $299 (£210) and include support for High Dynamic Range (HDR) gaming, with extra levels of brightness and more colour.

Pictures of the device, which will also include 4K DVD and Blu-Ray playback, were leaked ahead of E3.

One analyst said many gamers might not be ready to buy a new console so soon after the Xbox One's release.

Experts say the patent deal paves the way for the Chinese firm to sell its handsets in Western markets.

Microsoft will benefit from the fact that some of its Android apps - including Office and Skype - will now be pre-installed on Xiaomi devices.

The announcement comes at a time when Xiaomi has been struggling to meet sales targets.

In a blog post, the company said it would focus on services such as gaming tool Xbox Live, the consumer version of its Outlook email service, and its consumer documents-sharing service.

But for its search engine Bing, Microsoft cited free expression and said it would remove links only when that "is required of search providers under local law".

Initially, Microsoft will rely on consumers to report objectionable content.

The company also said it would fund research of a tool that scans content and flags images, audio and video.

WinBeta's inside sources are claiming that the Microsoft software has gained an additional 90 million users since October.

Such a leap sounds dubious but the figures take into account all devices, not just PCs, plus Christmas sales of Windows 10 hardware is sure to have helped its cause.

Microsoft is yet to reveal official install figures for Windows 10 since the 110 million downloads it announced in October.

The Redmond firm has announced that its latest operating system will not be rolled out to older devices until "early 2016".

"This November we introduced Windows 10 to phones including brand new features such as Continuum and Universal Windows Apps with the introduction of the Lumia 950 and 950 XL," said Microsoft in a statement.

"The Windows 10 Mobile upgrade will begin rolling out early next year to select existing Windows 8 and 8.1 phones."

In a blog post entitled “OneDrive storage plans change in pursuit of productivity and collaboration” — wording reminiscent of when a company announces layoffs by “right-sizing” — the company said that it will be eliminating its Unlimited plan for Office 365 and reducing maximum storage on its other plans.

Here’s the recap, from Microsoft’s blog:

Spanish retailer Ecomputer is listing the Lumia 950 at €659 and its larger sibling at €749, roughly the same as what the iPhone 6S and 6S Plus cost on the continent.

As these prices do not come from Microsoft itself, they should be taken with a grain of salt, but it's only a matter of weeks before official information will come our way.

The Redmond firm is holding a product unveiling in New York on October 6 and the new handsets are expected to take centre stage.

According to rumours site WinBeta, the operating system will receive a "major update" in November, ushering in a range of new features.

The revamp will reportedly include extensions for the Edge browser, performance enhancements, and a new universal Messaging app for desktop users.

Edge is expected to gain support for the WebM open source HTML5 standard through the update, as Microsoft has been working on this for a while.

Dodging next month's IFA gathering in order to go out on its own, Microsoft will reportedly debut the eagerly-awaited Surface Phone alongside the final Windows 10 for mobile release.

It's not the only Microsoft-made device being tipped for an October unveiling, either. According to Chinese Windows blog, WPDang, the flagship phone will debut alongside the heavily rumoured Surface Pro 4 tablet and a second-gen Microsoft Band wearable.

While it may be useful for some,