Are Microsoft Beginning Development of Xbox 720?

The PS3 and Xbox 360 are getting on a bit. That's not to say the consoles are any less great than they were when they were released; in fact they are getting better with age. Recently we've seen slim versions of the consoles as well as motion gaming peripherals, which suggests that Sony and Microsoft are hoping to squeeze at least a couple more years out of the systems.

But in saying that, it's safe to say that both companies will be at least thinking about what their next move will be. In fact it seems Microsoft may have taken the first move towards what fans are calling the Xbox 720.

In an interview with CVG Christofer Sundberg, founder of Swedish studio Avalanche (behind the great game series Just Cause) discussed the future of the Xbox and how it will affect his company.

Avalanche have a history of being screwed over by surprise/sudden console releases. “When we worked on Just Cause 1, the Xbox 360 came out. We had to do the 360 version in six months." Sundberg said.

But could this happen again? Sundberg for one, thinks it might."It’s an interesting place again right now, where the projects we’re working on today might be coming out on Microsoft’s next technology” he told CVG.

And he could be right to have his suspicions. Microsoft posted job listings last night which suggested work on the so called 720 has started. The job is for an engineer who will  “play a key role in the development and verification of the Xbox and future platforms”.

Whenever the 720 does come out it seems the general consensus is that it will be a disc-free device.

Sundberg said “everyone is speculating” over the timing and technological make-up of both Sony and Microsoft’s next console, but  “everyone agrees on one thing there will be no optical disc compatibility.”

He's probably right, but what else will we see on the new consoles? What do you think?