Update: Microsoft has told Game Front it has no plans to release an Xbox One console without Kinect.
"We have no plans to introduce an Xbox One without Kinect. We believe in Kinect and the value it brings to both games and entertainment, and believe $499 is a great value for what consumers receive with their Xbox One," reads a statement from Microsoft.
Original story: Microsoft will release two additional Xbox One SKUs in summer 2014 in the hope of undercutting the price of the PS4, a source has told Machinima's Inside Gaming Daily.
The anonymous source claims the two new SKUs would each drop Kinect from the bundle. The first would be the same as the launch model, only with Kinect removed, whilst the second would drop Kinect and opt for a smaller hard drive.
It's thought the 500GB model will retail in-line with the PS4 at $399, whilst the second model would drop the price even lower, down to $350.
Whilst many believe Microsoft will have to cut the high price of the Xbox One, removing Kinect does seem like an unlikely step given how integral to the experience the platform holder intends it to be.
However, the anonymous source does back up claims from Baird analyst Colin Sebastian, who believes Microsoft is working to close the price gap between the Xbox One and PS4.