Aside from the business sense of launching a smaller Xbox 360 with a brand designed specifically to dent Nintendi’s marketshare, there are signs that point to plausability. Those who follow hardware rumours in the games industry will likely have heard of the Xbox 360 Valhalla chipset – while not exactly confirmed, the chipset is rumoured to combine the existing 65nm CPU and 65nm GPU chipsets, reducing not just the cost of Xbox 360 production but potentially the amount of space required inside the console’s housing. Valhalla is pegged for availability in 2010.

1UP also mention that the console will see a rebrand – Xbox Natal obviously springs to mind – but this raises other questions. If Microsoft chose to slimline the console, rebrand the unit and bundle it with Natal, it could be a significant marketing win, but there’s some speculation that the console would include new hardware architecture. If Microsoft splinters the Xbox 360 install base without making a true technological leap we’d expect in a traditional console cycle, that feels like a mistake. Mind you, new hardware architecture doesn’t seem to gel with the way Microsoft has spoken about platform lonjevity in recent months, and it’s important to remember Xbox Natal will be available for all existing Xbox 360s.

Interesting times – the question is, will Nintendo beat Microsoft to the punch with the long-rumoured, oft-denied Wii HD? Remember, Nintendo famously denied the existence of the DS Lite days before its unveiling…

How much Snake can you fit in 16GB?

As it turns out, Metal Gear Solid: Peace Walker, the fourth Metal Gear game for Sony’s portable, will play a significant role in the series’ cannon. Speaking in a recent interview with Famitsu (via the black magic of Google Translate), Kojima has implied that Metal Gear Solid: Peace Walker is his Metal Gear Solid 5. That’s a fairly big boon for Sony’s portable platform – no doubt Peace walker will help shift PSPgo units when it hits the PlayStation Store (and possibly retail shelves) in 2010.

From what we know so far, Peace Walker will be set in 1970s Costa Rica and will uncover the unexplained period in the series’ history that saw the rise of secret organisation Outer Heaven. It should be a real treat, and it’s great to know Koima and the Metal Gear Solid 4 team will be intimatley involved in the production.

Peace Walker will be set in 1970s - it should fill in a few blanks.

Kojima also spoke briefly about Rising in the Famitsu interview, saying that the big budget title will be “a completely different kind of action than what has appeared in the series so far”. A gameplay reboot with a redeveloped graphics engine staring Raiden is fine by me, so long as MGS4 cyborg Raiden doesn’t revrt to Mr. MGS2 whingypants.

So much for no more involvement in Metal Gear, ‘eh Kojima san?