Even bigger though is the option to install games entirely to the HDD for faster load times and no disc drive noise. However, to get the installed game to boot, the disc has to still be in the drive for an initial check to make sure you still own it.
The new party system that's built into the interface supports up to eight people and allows for chat, sharing of media, and simultaneous launch of games, all for the entire group. As for the so-called Xbox Live Primetime, it's basically a system that allows users to participate in what amounts to virtual game shows, many complete with prizes and a live host.
The last few bits include a few notes on Avatars, including their integration into Arcade games, future retail releases and of course the newly christened "Live Party". Also, for those techies out there, the update will add 16X10 over VGA or HDMI, and support for 1440x900 or 1680x1050. Oh, and you'll be able to buy anything from the Marketplace via Xbox.com too.
Plus the ol' Major promises that there is still more details to be revealed as the update draws ever closer.
[Thanks to everyone who sent this in!]