The current dashboard although not being too bad, has a few problems which sucessive update haven’t fixed, such as  too much information on screen, a bit of lag, hard to navigate in so much content (you have videos, games, addons, music,etc) and some areas were simply over-complicated.

Old Xbox Layout:

New Layout below:

With this aproach I think Microsoft is going the “Apple way” and going for a more simple, less complicated but coese design. On the other hand, with Sony releasing it’s “Home” pseudo-Second Live world/dashboard and given the Wii’s success with the Mii’s, Microsoft felt the need to introduce some sort of Avatars into the console.

Joystiq has posted a video walkthrough of the new Dashboard and Xbox Focus has detailed information on the new features. Now it’s all about waiting for the next system-update and experience the new dashboard hands-on.