Just to let you know, this product here, complete with picture, is a rumor. The source of this story comes from Team Xbox, who say that Microsoft is working on this Digital Entertainment Handheld. This is what it is: an Xbox 360 with a Zune. Your two favorite things in one package? Well, maybe not the Zune, but one out of two ain’t bad. (Not another “Zune slam”, stop it already.)

Anyway, the project is codenamed “xYz”. I am assuming the “X” comes from the Xbox 360 and the “Z” comes from the Zune. As for the “Y”, the answer to that is “because they can, and it would make money”.

Other facts are pretty sketchy at this point, but we do know that the xYz will come with a WVGA touchscreen. Assuming, of course, that it gets created.

Normally, I don’t report on something unless I have a viable source (or sources), but I am reporting on this to generate buzz. You see, I am hoping that all the chatter about this product will create a demand for an Xbox 360 Zune, and the company will make it to meet this demand. Hey, I can dream, can’t I?

Seriously, does anyone out there know if this is legit? If so, feel free to chime in with a comment.

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