Microsoft reportedly benches its Xbox handheld to focus on making Windows 11 competitive with SteamOS

Valve's push for wider SteamOS adoption seems to have forced Microsoft to change course.

Microsoft has openly discussed ambitions to produce its own handheld gaming device for years now, but such plans may now be on pause. It seems the company wants to ensure its software, namely Windows 11 is up to scratch before devoting its attentions to new hardware.

Reports of this change in direction come from Windows Central. The outlet claims Microsoft has at least three prototypes in development for its 10th generation efforts. One of which is the now-paused Xbox handheld codenamed ‘Pembrooke’, alongside what are likely successors to the Xbox Series X and S.

Windows Central states that the Asus device codenamed ‘Project Kennan‘ remains in production. In the meantime, Microsoft is throwing its full force behind improving Windows 11 gaming performance which should greatly benefit the device and future first and third-party efforts.

This shift in approach isn’t too surprising. Valve has begun supporting SteamOS on handhelds outside of the Steam Deck, including Lenovo Legion Go S. This particular device has served as a showcase for the performance gaps between the Linux-based operating system and Windows 11, with the former offering noticeably better frame rates.

We should see the fruit of Microsoft’s efforts to improve Windows 11 later this year, when Project Kennan makes its formal debut. Details on the machine are thin, but rumours claim it will leverage AMD’s Z2 Extreme SoC (System on Chip) making it a particularly powerful portable PC.

Of course, SteamOS isn’t the only competition Microsoft will need to contend with. Nintendo Switch 2 will launch well before Project Kennan, but price differences could place each console at entirely different ends of the market.

With the handheld market becoming more crowded by the day, Microsoft’s decision to polish its operating system before launching hardware seems like the right move. After all, Windows 11 has proven itself to be a common issue among devices like Asus ROG Ally and more in spite of their more-powerful hardware.

Fahd Temsamani
Fahd Temsamani
Senior Writer at Club386, his love for computers began with an IBM running MS-DOS, and he’s been pushing the limits of technology ever since. Known for his overclocking prowess, Fahd once unlocked an extra 1.1GHz from a humble Pentium E5300 - a feat that cemented his reputation as a master tinkerer. Fluent in English, Arabic, and French, his motto when building a new rig is ‘il ne faut rien laisser au hasard.’

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