This rumour does the rounds every so often, so excuse us if we're not hopping up and down with excitement, but the blog world is buzzing with the speculation that the Xbox 360 is to launch with an integrated HD DVD drive.

With CES imminent, the latest rumour does have a little more credibility as the story goes that it will be announced as part of Bill Gates' keynote speech at CES, his last as head of Microsoft.

An integrated HD DVD drive would make sense for the console, especially in terms of the wider picture of the whole format war, but Microsoft do risk confusing customers as they are currently three versions of the machine available already.