Asus to Potentially Launch Xbox Handheld in 2025: Collaborating with Microsoft to Integrate Windows and Xbox Libraries

Late last year, Microsoft Gaming CEO Phil Spencer mentioned that an Xbox gaming handheld might not be hitting shelves for several years. Yet, this doesn’t mean other manufacturers aren’t exploring the idea with Microsoft’s blessing. Insiders have informed The Verge that Microsoft is planning to unite Xbox and Windows into one cohesive platform, and Asus is onboard as a launch partner for this mission. Asus is currently working on a project called “Kennan,” which is a gaming handheld anticipated to benefit from Microsoft’s plans, possibly making its debut this year.

Besides Asus’s hardware, Microsoft is also developing “Project Bayside,” a framework aimed at creating a standard Xbox interface adaptable across various devices. This interface will operate on Asus’s handheld, running a Windows-based system with an Xbox-themed overlay. Both Kennan and Bayside represent Microsoft’s strategy to merge the successes of Xbox and Windows.

In a conversation with The Verge earlier this year, Jason Ronal, Microsoft’s VP of Xbox gaming devices and ecosystem, highlighted the company’s focus on this integration, with hopes of seeing significant progress by the end of the year. But while these whispers spark interest, there’s still no official word or teaser from either Microsoft or Asus.

The introduction of Valve’s Steam Deck back in 2022 revitalized the handheld gaming console landscape. Currently, Microsoft enjoys a slight edge over competitors like the Steam Deck, largely because many top portable gaming devices run on Windows 11. However, changes are underway with Lenovo unveiling its Legion Go S, a version powered by SteamOS. The Windows 11 version of the Lenovo Legion Go S is available now for $729, but come May, a SteamOS variant will be released at a lower price point of $499. Lenovo also plans a more economical Windows version at around $599, but the $100 price difference might make the SteamOS option more appealing to gamers.

This scenario surely has Microsoft’s attention, especially since one of its trusted OEM partners is embracing a different operating system this coming May. Valve appears ready to pit SteamOS against Windows in this new battlefield. Already facing stiff rivalry from the PlayStation 5 in home consoles, Microsoft is unlikely to welcome another competitor in the handheld arena. Consequently, it remains crucial for Microsoft to reinforce Xbox and Windows as the go-to systems for portable gaming to maintain its market leadership.