Xbox Reportedly Collaborating with Asus for Handheld Console Development

Xbox is reportedly working alongside Asus to create its much-awaited handheld gaming console. The collaboration, if it materializes, would combine Microsoft’s gaming experience and Asus’ knowledge in handheld gaming PCs to create a serious challenger in the market.

Project Kennan and Xbox’s Handheld Strategy

Xbox’s handheld project, codenamed Project Kennan by rumor, has been in development for some time now, and Microsoft Gaming head Phil Spencer publicly confirmed last year that the firm was indeed working on the idea. Asus, the maker of the ROG Ally, is reportedly its manufacturing partner behind putting the console into production, according to current rumors.

As reported by Tom Warren of The Verge, Xbox and Asus are targeting 2025 release, but industry analysts are not so sure and believe that 2027 may be a more suitable time frame for the launch—possibly around the same time as Xbox’s next-generation console.

Xbox’s Vision: A Unified Gaming Experience

The collaboration with Asus was reported to be under a wider strategy for Windows and Xbox platform convergence. The portable device is reported to have an optimized OS to enable gamers to switch immediately between their Xbox console, PC, and portable device.

Codename Project Bayside, the project has the potential to upgrade the Xbox ecosystem through expanded Game Pass availability and cross-platform compatibility. It would make Microsoft a contender in the handheld gaming market, as it is presently dominated by the Steam Deck.

Difficulties in the Handheld Market

While there are those waiting to witness an Xbox handheld, Microsoft will have enormous competition. Steam Deck itself has sold an estimated 3.7 to 4 million since they entered the market, soundly dominating handheld gaming PCs from players like Asus ROG Ally. The Switch continues at the helm by Nintendo, with Sony even considering creating a new handheld.

But history teaches us that a brand can overcome—Sony’s PlayStation Vita, even with all its woes, outsold the Steam Deck nearly three to one in its first three years. If Microsoft and Asus can deliver a fast, value-priced, and well-integrated handheld, they might take a large chunk of this burgeoning market.

For now, Xbox fans will have to wait for confirmation, but a chance of an Xbox handheld backed by Asus is an expected step forward for gaming on the go.