The new Xbox will operate as a gaming PC running Windows 11, but by default, it will launch in "TV" mode with a console interface. The Xbox layer is integrated into the system, eliminating unnecessary processes and creating a gaming-focused environment, while allowing the player to "exit" into full Windows, like on the Steam Deck. This means one day you play as on a console, another day you use the system for streaming, applications, or regular PC programs.
The device will retain backward compatibility: games from Xbox One and Series X|S will run, while access to regular Windows 11 stores, including Steam, will be available. This changes the strategy: Xbox ceases to be a "single store" and transforms into a platform of choice.
The SoC of the new Xbox, internally called "Magnus," is expected to be released by 2027. There will be a basic premium version from Microsoft and options from OEM partners — expensive, budget-friendly, in various form factors. The Xbox Ally from ASUS already demonstrates this approach: console interface on top, Windows underneath.
If Microsoft creates a simple and responsive interface and ensures that Windows doesn't interfere with the console's operation, players will get the platform of their dreams: an Xbox library and PC capabilities in one device. Otherwise, the market will remind why gamers bought consoles: to avoid fighting with the system.