Toshiba + Microsoft = New Xbox 360?

In light of recent events, a new rumor making the rounds has an interesting twist.

Word has it that Microsoft is looking to combat Sony more directly by integrating a HD-DVD player into a new model of Xbox 360, so that the unit will be more readily able to match the built-in Blu-Ray player housed within the PlayStation 3.

According to studies conducted by Sony Brand Wave in the UK, Australia, France, Germany, and Spain, the Blu-Ray is a key factor behind the sales of the PS3 in those regions.

Interesting to note is that Microsoft’s partner of choice in this rumored coalition is none other than Toshiba, the same Toshiba who recently acquired the rights to Sony’s prized Cell processor.

Talk of the new device mentions that in addition to extensive game-playing capabilities, the “Entertainment Xbox” would also be positioned as an entertainment hub with extensive networking capability, 1080p playback, and maybe even a dual HD TV tuner, EPG capability, and a docking port for your MP3 player. What, no cup holder? Then again, unless you’re drinking coffee or hot cocoa…

Toshiba sees this as a critical move for both companies to combat Sony’s Blu-Ray, and might even market a version under their own name. “Toshiba 360?” Wrap your head around that one.

Another design possibility mentioned looks at an open standard chassis system that would allow for the console to be slotted into a HDTV of over 40 inches, as well as allowing for easy hard drive expansion akin to a PC’s. Plus, they want to make sure the unit runs more quietly as movies are played.

And the final touch of inclination for Microsoft to make this move is the introduction of components less likely to fail. The PS3 has a failure rate of under 2 percent, while the Xbox 360’s has websites and music videos dedicated to the frequency of theirs.

If all this proves to be more than a simple rumor, then it could be released in late 2008, or even at the 2009 CES show in Las Vegas. And if rumor does become reality, AMN will be there to give you the scoop.