I think a dedicated handheld would be a terrible idea but a portable multimedia device that plays games would work great. I'm thinking iPod touch or iPhone. If it has Xbox Live integration with an Arcade Marketplace with achievements it has a chance to gain headway.

Unlike the Zune they should just create the OS and let other companies license it such as HTC, Samsung, Asus, etc.

I hope not. More than enough out atm, lets keep it like that please.

i would love a zune touch or something. i would love a portable pinata :)

i would buy it if they ever decide to make one and of course halo would be the major launch game. i think they should only attempt this uphill battle, if they would buy at least 3 or 4 3rd party studios and make their 1st party stronger. so that they would have enough games , till they could prove that thier handheld was capable of competing with nintendo and sony.

http://vgchartz.com/games/game.php?id=25021&region=All

You're missing the point.

Point is that portable pinata already exists. Point is also that Microsoft has allowed their first-party content to be released on their rival's handheld, which proves they're not interested in entering the handheld gaming market.

I don't think they will release a handheld system since Nintendo will come up with a new handheld system for the next generation and will sell a lot. They don't have a chance against Nintendo.

Hmmm it would be hard for MS to make profits in the handheld market because the competition is too strong. Nintendo is just too strong and I'm not even sure that Sony is profitable in that market with the low software numbers we see each week.

but there wasnt too much competition when they joined the console wars. when they were going up agaiinst the ps2(which has sold more then the ds if i believe correctly) and the gamecube and the dreamcast(i think)

where as there are only 2 competitors in the handheld market

that doesnt make much sense

can someone explain it to me?