Microsoft may be working on a ‘Xbox TV’ set-top box

With use at an all-time high for Xbox Live members, Microsoft could be planning to debut a new, cost-effective set-top box for streaming media.

The information comes from a report by The Verge, which cites unnamed sources familiar with the plans. The “Xbox TV” device would offer users a striped-down hardware version of the Xbox 360 console that’s optimized to play videos, music, and online games. It’ll run core components of Windows 8, and apparently scheduled for a 2013 holiday released date.

The new, cheaper Xbox TV is part of Microsoft’s plan to make sure its digital media efforts can scale across multiple devices, according to The Verge’s source. That makes sense because, if Microsoft wants to seriously take on Apple and Google, it’ll need to ensure that more people have access to Xbox Live through their television sets.

Apple and Google also have set-top boxes at a $99 price point, which is something Microsoft will need to remedy if the Xbox TV rumors prove true.

On a related note, Microsoft was also rumored to be working on a new Cloud TV service last week. It’s possible that these two rumors are related, but of course we won’t know until Microsoft makes an official announcement.

We’re reaching out to Microsoft for further comment, and will update the post with any new information.