Microsoft is developing a set-top box that provides access to its entertainment features, made as a low-cost alternative to its full console, The Verge reports, citing anonymous sources.

The device, dubbed "Xbox TV," supports "casual" games and runs on Windows 8, with an "always-on" chipset that allows for quick boot-up and resumption of programs, the report says. Xbox TV would be part of a broader attempt to scale its products, making them available on a range of devices, such as Microsoft Surface, SmartGlass (for iOS pictured above) and smartphones. It is expected to be revealed before the holidays next year, The Verge says.

Microsoft provides the following statement regarding any future set-top box plans: "Xbox 360 has found new ways to extend the console lifecycle by introducing controller-free experiences with Kinect and re-inventing the console with a new dashboard and new entertainment content partnerships. We are always thinking about what is next for our platform and how to continue to defy the lifecycle convention."

That's certainly not a "No, we'd never do that" kind of statement.

This article was originally published on Joystiq.