Harmonix, the developer of the blockbuster Guitar Hero franchise, MTV and EA announced Rock Band.

Rock Band will allow gamers to perform music from the rock stars with their friends as a virtual band using drum, bass/lead guitar and microphone peripherals.

The record labels - EMI Music, Hollywood Records, Sony BMG Music Entertainment, Universal Music Group's Universal Music Enterprises and Warner Music Group's Rhino Entertainment - have agreed to supply master recordings by their artists for use in the game.

Electronic Arts will exclusively distribute and market Rock Band. The Rock Band game has a vague release date of Holidays 2007.
See the official site of Rock Band.

I am not quite getting the appeal of Guitar Hero. It is extremely successful though. Is the simulation of playing an instrument bringing more kids to actually learn a real instrument or will it drive them away? It is much easier to be a 'guitar hero' on a game console than to become the next Jimi Hendrix.