Is Microsoft going to release a handheld version of the Xbox? That's the word according to a new report from The Diffusion Group, a new-media research firm. While Microsoft head honcho Bill Gates was mum on the subject at this month's Electronic Entertainment Expo in Los Angeles, he hinted that game development is all about the software. That might imply Microsoft is planning to let hardware companies (like Alienware) actually build the consoles, licensing them to use the Xbox system. Or it could mean that the Redmond software giant will introduce its own portable game console (like the mock-up shown here that made the rounds a few weeks ago), which would almost certainly be a multimedia player similar to Sony's PSP. With an Xbox portable in the market, gamers would have three handheld consoles to choose from (including the PSP and the Nintendo DS), and it would certainly be popular with anyone wanting to play Halo while on the go!
— Peter Suciu