Despite being told face-to-face that there was no truth in the story by a man from Microsoft, those handheld Xbox rumours just won't die.


Now a research collective called The Diffusion Group is predicting that Microsoft "will likely leverage its Xbox franchise to enter the portable games console market in late 2007 or early 2008", and is expected to "embed a portable multimedia player in a handheld gaming platform similar in many respects to a Sony PSP."


This part of the report isn't particularly surprising (apart from its use of "leverage" as a verb - those crazy Yanks), as Microsoft has worked on portable multimedia devices before, by licensing out its Windows Media Center software to other companies like Samsung and Creative. Creating its own device, perhaps with an Xbox 360-echoing design, isn't too much of a step up from this, particularly for a company with Microsoft's resources.


As ever, we'll keep an eye out for further news. In the meantime, take a look at our mock-up and imagine playing Halo 4 on the way to work.



Thanks T3

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