One system will be a full console; the other will be a cloud-connected system for streaming games. Since then, we've learned that the new consoles are codenamed Scarlett, and that they'll arrive in 2020.
I don't think however Microsoft needs new hardware to take on the casual gamer market.
"The cloud console will have a limited amount of compute locally for specific tasks like controller input, image processing, and importantly, collision detection", writes Thurrott.com.
We're not suggesting that the console wouldn't have a GPU, just that it might not need all that much hardware in comparison with the "premium" offering.
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Under the hood, you'll find a Snapdragon 625 at 2GHz; you can choose between 3GB RAM with 32 GB of space, and 4GB RAM with 64GB. In terms of optics, the smartphone has a 12 MP primary sensor and a 5 MP depth sensor along with an 8 MP selfie camera.
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Now, this sounds fine and good, but I suspect it's not exactly what Microsoft needs to win the next generation of gaming wars. This makes the end-user hardware much cheaper, but it has a consistent problem: latency. According to new information obtained by Sams, Microsoft is reportedly planning a new "cloud console" along with a traditional Xbox console that runs games locally. The streaming box is also set to launch in 2020.
The benefit here is that Microsoft's cloud platform reaches around the globe with data centers in every major market.
It's very clear at this point that Microsoft know that they are onto a victor with the Xbox Game Pass service, and if they can continue to build their subscriber base up, they'll have long-term financial success and be able to insure that their first party games are successful for them, not just on a units sold basis. A "splice" or "slice" of the game will run locally, and Microsoft's cloud will "stitch" it together with the game running on the server side. It is likely however that some Scarlett machines will also be high-end and fully powered and that cloud-powered Scarlett boxes could be pretty cheap, and be created to appeal to the casual gaming market. Microsoft notably bet badly when they deployed the Xbox One, and it's paid for its hubris this generation with lifetime Xbox One sales less than half of what the PS4 has racked up. While local hardware may eventually be unnecessary for gaming, Microsoft will continue to give gamers a physical box for at least one more generation. I believe a better solution would be to let Windows 10 users run high-end games on their own cheap laptops using their split-rendering solution.