Microsoft Xbox portable set for 2007?

Opening the Xbox : Inside Microsoft\'s Plan to Unleash an Entertainment RevolutionWhile earlier reports of a portable Xbox set for release in 2006, turned out to be Microsoft’s tablet PC line named Origami. This time, in author Dean Takahashi’s new book, The Xbox 360 Uncloaked, it’s mentioned that:

The Xbox 360’s hardware team have been divided in two: half to work on reducing production costs for the Xbox 360, and the other half is at work on making a portable Xbox console. The portable is meant to launch halfway through the life span of the Xbox 360, when sales usually start to decline due to announcements about next-generation home consoles. If true, this could be as soon as 2007!

The book also reveals: That Microsoft could have had Grand Theft Auto exclusively on the Xbox but passed on it. Epic’s influence in upping the system’s RAM from 256 to 512 MB (by showing Gears of War running under both) ultimately cost Microsoft $900 million extra and resulted in fewer units at launch.

Microsoft even expected that Rare would release five major Xbox games in the next 12 months to 24 months after being bought. Oops, I think they messed up a few times in the past 🙁