Microsoft planning three versions of Xbox 2?

The next-generation Xbox console may come in three different versions, according to a report today which claims that the firm plans to launch versions with and without a hard drive in 2005, and a fully functional PC / Xbox 2 combination in 2006.

Technology website The Inquirer reports that an NDA'd presentation given by Microsoft to analysts and market researchers in the UK pointed to the existence of three hardware versions, with two of them launching next autumn.

Xbox Next and Xbox Next HD would largely be functionally identical, but the latter of the pair features a hard drive and offers increased functionality as a result - which could be anything from Xbox backward compatibility (which the basic model could not offer due to the lack of a hard drive) to media jukebox functions or TIVO-style video recording.

In itself, that's not an entirely unlikely scenario, and indeed, Sony is expected to offer two different models of PlayStation 3 as well - one a basic "games only" device, and another with a hard drive and extended media centre functionality.

Indeed, Microsoft has already told developers not to rely on the presence of a hard drive for their games, but has curiously failed to rule out the possibility that a drive could be present. Theories for this range from an internal debate at Microsoft about the cost to benefit ratio of the hard drive, through to the remote possibility of the hard drive being sold as an optional extra - on balance, the idea of two versions of Xbox 2, with and without hard drive, seems eminently more reasonable.

The third version of the Xbox being touted by today's reports, however, is a rather more unexpected beast - titled Xbox Next PC, it combines the Xbox 2 with an entry-level PC which would run a media-focused verison of Windows, run standard PC software and games, and include a CD burner, wireless keyboard and mouse.

This system would not launch until Autumn 2006, and aside from the question about whether it really exists at all or not (a similar system which integrated PC functionality into the Xbox was widely reported on about three years ago, but never saw the light of day and may have simply been an elaborate hoax), there's also a major question mark over how such a system would work - since the Xbox 2 is based on PowerPC G5 processors, which won't run the Windows operating system, let alone PC games.

It's possible that a version of Microsoft's VirtualPC software, which allows Apple Macintosh users to run Windows operating systems under emulation on their PowerPC based systems, could be used to provide at least basic functionality - or PC hardware could be built into the console alongside the existing Xbox hardware, driving costs up but providing much better performance and reliability.

Either way, the possibility of multiple versions of Xbox Next will certainly make Bill Gates' keynote speech at CES in early January, where he's expected to publicly unveil the console, even more interesting.