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Xbox 720 in 2012 wouldn't be a surprise - analyst

360 "has peaked in some respects"

EA has dismissed reports that it's already in possession of Xbox 720 hardware as "total fabrication - 100 percent not true", but announcing a 360 successor in 2012 certainly isn't out of the question, according to M2 Research analyst Billy Pidgeon.

Speaking to IndustryGamers, he suggested that Xbox 360 has lost some momentum.

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"While Xbox 360 has peaked in some respects, particularly in North America, the system is still selling strongly and penetration potential remains - in Europe overall, and in the young end of enthusiasts as well as the mass market for an extended back half of this cycle.

"It's in a vendor's best interests to maintain a system's viability as long as possible," he added. "On the other hand, should Xbox 360 hardware sales begin to drop off dramatically in Q4, or early in 2012 Microsoft will likely announce launch of a new system at E3 next year."

Last week, an unnamed source told respected games industry publication Develop that "Microsoft is rushing to make an [Xbox 720] announcement at E3" in a bid to steal Nintendo's thunder.

The site was also told that developers have been allowed to see improved features that upgrade the 360's current capabilities, including a speedier and enhanced interface with Kinect that boosts the device's responsiveness.

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