Yesterday, at the Microsoft Financial Analyst Meeting 2004, Microsoft Corp. Chief Executive Officer Steve Ballmer said there won't be Xbox 2 next year. We don't know if he's referring to calendar 2005 or simply the next 12 months. "There's no new Xbox in the next year, but, man, are we hard at work on that next Xbox," Ballmer said.
So, there you have it. Contrary to what most industry insiders claimed, there might be no Xbox 2 in 2005 if that "next year" means calendar 2005, which means the next generation console war could start in 2006 with Nintendo's Revolution and Sony's PlayStation 3. If he meant by "the next year" the next 12 months, then Xbox 2 could launch in late 2005, just in time for the Christmas season.
News source: Team Xbox