Rumors Suggest Asus to Unveil Xbox Handheld in 2025, Collaborating with Microsoft to Merge Windows and Xbox Libraries

Last year, Phil Spencer, the CEO of Microsoft Gaming, made it clear: an Xbox handheld gaming device wouldn’t be hitting shelves anytime soon. However, other manufacturers have decided not to wait around and have taken up the challenge. According to The Verge’s sources, Microsoft is making strides to merge Xbox and Windows into a unified platform, with Asus stepping up as a key partner. Asus has embarked on developing Project Kennan, which is their codename for a new gaming handheld, possibly poised for a release this year, and it might just get a boost from Microsoft’s new direction.

In addition to Asus’s hardware, Microsoft is busy with something called Project Bayside. This initiative aims to create a standardized Xbox interface that can operate smoothly across various devices. Bayside will run on the new gaming handheld from Asus, essentially a Windows-based system but with a distinct Xbox overlay. Together, Kennan and Bayside symbolize Microsoft’s ambition to marry the strengths of Xbox and Windows.

Jason Ronal, the vice president of Xbox gaming devices and ecosystem, shared with The Verge earlier this year that the company is prioritizing this integration. He indicated that they anticipate results later this year. Nevertheless, enthusiasts are still waiting for an official word or even a teaser from Microsoft or Asus.

The Steam Deck by Valve sparked a resurgence in handheld gaming consoles back in 2022. Yet, Microsoft holds a competitive edge in terms of versatility since many top PC gaming handhelds run on Windows 11. However, the game might be changing with Lenovo’s announcement of the Legion Go S, which operates on SteamOS. Right now, you can buy the Windows-enabled Legion Go S for $729, but if you’re eyeing the SteamOS version, it’s rolling out in May for a much more wallet-friendly $499. Lenovo is also promising a cheaper Windows version for $599 around the same time, though the $100 saving might just push gamers towards the SteamOS model.

Such moves have undoubtedly caught Microsoft’s watchful eyes, especially since one of its major OEM partners is rolling out a broadly liked OS alternative come May. This development highlights Valve’s increasing competition with Windows using its SteamOS. Already contending with the PlayStation 5 in the console arena, Microsoft probably has little desire to see Valve edge into its territory with handheld gaming systems. If Microsoft wants to maintain its market dominance, ensuring Xbox and Windows remain the go-to choices for portable gaming is crucial.