Forums around the web saw a hive of activity when Microsoft let slip that backward compatibility was not likely on the upcoming Xbox 2 in their original presentations. Microsoft cited that the hardware would not be able to simulate the functions of the hard drive, nor the specialised nVidia graphics chipset without significant cost, both in terms of reaching an amicable agreement with nVidia (to allow Xbox engineers to simulate the chipset), and to the R&D boys to make it all work. With the prospect of it meaning that Xbox 2 consoles would be sold at a loss, this is obviously not a route Microsoft wished to pursue.

'But Playstation 2 (and 3) have (will have) backwards compatibility' cried anxious Xbox owners on forums around the internet. Indeed, some could argue that it helps retain brand allegiance, something Microsoft will need to help boost initial take-up of the new machine.

So it is with interest that a couple of news stories have cropped up regarding this issue recently. Last week, some misinterpreted wording in an article on Wired.com suggested that a 'universal emulator' would be used to achieve the holy grail of backwards-compatibility, through software, in Xbox 2. Head honcho of Silicon Valley start-up outfit Transitive Corporation, CEO Bob Wiederhold, stated that the technology would allow Xbox compatibility in software for Xbox 2; the article, however, said it will allow such a function. Quibbling over terms, maybe, but it was enough to create a mini-wave of excitement. However, whilst generating plenty of discussion, the report was (unfortunately for Xbox'ers) unfounded.

Still, another week, another possibility. This week, an article on the unashamedly-named Geek.com mentioned that Microsoft's Virtual PC 7 software has been given exclusively to the Xbox team. Adding fuel to the fire is the fact that the version of Virtual PC 7 recently released had the software emulation of a 3d video card held back in order get it to market quicker. Furthermore, Xbox 2 will include IBM PowerPC 970, and current Xbox game developers are shipped G5 PowerMacs (that run Windows). A connection being made could be so that the functions of the Xbox can be simulated in software on Xbox 2, however with nothing but speculation to go on, this cannot be confirmed at this time. As usual, Microsoft are staying quiet, and there are a lot of 2+2's in there, but Xbox'ers the world over will, I'm sure, be hoping that this is it.

We'll be keeping a watchful eye on this story as it develops.

Carry on the conversation on the VideoGamer forums!