When is this vid from? 2006? It's been the same FUD for nearly 3 years now. You know that these arguments, cherrypicked from bluray's infancy don't apply nearly 2-3 years later. 

Like saying there is a fundemental flaw with the 360 that keeps the RROD from going away?
You have to put up with these sort of arguments.

Isn't this kinda like microsoft admiting it needs more powerful console to compete with ps3 technically? 360's release was rushed and they're rushing again if this console is gonna be as powerful/barely more powerful than PS3. Also will 3rd party developers only gonna satisfy making games which run well on the older version too or will they push the XBNatal to it's maximum restricting games from players with the older XB360?

Metal Gear Solid 4 was released June 12, 2008. Why you need installations for this game?

lets all argue and debate on something that's obviously fake! gogogoz!

Huh? Not really. Most people don't care about the difference and most people who appear to care are fanboys. Theres no advantage really having a slightly more powerful system, however there is an advantage with having a considerably more powerful system especially for Microsoft as they can leverage the PC/360 angle better and exclude the PS3 for reasons beyond the difficult PC/PS3 conversions if this upgrade rumour is somewhat legitimate at least. Furthermore theres the angle that the camera is already expensive so it means that current generation games can easily be retrofitted and the extra processing is shifted from the camera to the console.

If you think that an upgraded Xbox 360 would do anything less than be obviously and significantly more powerful than the PS3 you would have to be mistaken.

The news is signed Zach Morris.  You know the Zac Attack would never lie to you!  Unless you went to Valley, I suppose.

What makes you think the PS4 is going to be a "powerhouse"? I would guarantee you a free PS4 that it will be a minor 2-3x more powerful than the PS3. Just as this thread implies for the neXtBox and similar as GC to Wii, it will be a nominal power upgrade w/ a new control scheme and launch price $300 max.

MS and Sony are not stupid. They realize that building a new console like an extreame PC does a new PC is not going to make them profits and will actually hinder them. Instead they will copy Nintendo's idea with smaller upgrades to focus on profitability on day one.

Face it all you little 'mature hardcore' gamers, Nintendo changed the game. If you want to push the limits of computing then buy gaming PC. Consoles are returning to being consoles and will focus on experience and play, not pixels.

Enough to have more 1080p native games. SSD drives are quiet, fast, low power consumption because of no moving parts and seek files instantly. Don't ever need to defrag like hard drives.

I see a lot of complaining here.

First of all, assuming this is true, for a system that is gonna cost $300 and fixes RROD, the specs are simply perfect. I would buy one myself if this is true.

GPU:
If this is shader model 5.0, I can already guess which architecture it would be based on. The R800, and we all know how well the R700 of ATi was.. So if this is true, the GPU will be one powerful thing.. And all people saying "it's only 600MHz", if you think MHz defines the power of a GPU, you seriously should search for some background info about this stuff... It the depends on the ammount of stream processors in the GPU, and since ATi has a superior architecture, this is gonna be one hell of a GPU right here.. And oh, this GPU would probably be on 40nm as well, which means low production costs and almost no heat. On performance I think it would be on par with an HD4870 or even better. You know why that is possible? Because ATi can make those GPU VERY cheaply with a hell of a lot of performance, and if they want 1080p native, that is the way to go.

CPU:
If this is true, this CPU is gonna be VERY powerful.. People keep complaining the CPU of the X360 is not that strong, but that's simply not true. For games, general purpose computing is a big part of the calculations, while floating point is a small part, and the X360 CPU is based on general purpose, while the PS3 has only one general purpose core, and the other ones are floating point calculators, which means, if it wants to do general purpose, the calculations need to be emulated. And the 3 cores of the X360 can handle 6 threads in total, and if it's double, I guess they could do some wacky stuff with this...

Memory:
GDDR 5 says it all. Again I see people complaining "it's only twice as much, it should be more". But guess what, a big amount of RAM is not everything. The most important is still a low latency, and a high bandwidth, and GDDR5 provides that. 1024 MB is more than enough, because the OS will take almost nothing from it, and you could say games would have access to almost a whole GB, and seeing what can be pulled out of both the X360 and the PS3 at this moment with only 512MB, twice as much will really deliver.

Hard Disk:
One thing.. SSD costs more, but is also faster than a traditional Hard Disk. On reading that is.. Writing is slower.. So installing games might take longer, but I doubt they will remove the option to plug your current HD in it if all this is true. I would actually think it would be better if this was internal hard drive space but oh well..

Media Drive:
DVD is fine. Blu-Ray is overrated. The space is a problem, but I guess it isn't mandatory to include Blu-Ray. The only ones that complain about it are usually PS3 owners. And I guess if you want to keep the price down, you need to keep the DVD, especially since Sony might make it very hard for Microsoft to get them a Blu-Ray license....

WiFi:
If this is included it's a big plus, especially for that price of the system.

Price:
If it really is that cheap, I swear I'll buy one. At least, when I'm sure it doesn't have hardware problems.. And people, really... Stop complaining about more ram, Blu-Ray, and I don't know what else. Unless you want a $500+ dollar console, be happy with those specs and stop b*tching.

And one more thing. Last year, it was said that the next Xbox would be "forwards compatible". No one knew exactly what that meant.. What I always thought is that the current Xbox lives on as long as it needs to, and the next Xbox will be able to play ALL games of the X360 without emulation, but with upgraded graphics. In other words, it's simply an X360 V2, where it's basically the same console, but more powerful on graphics, and supports all X360 games completely, and if they release a game for the new Xbox, it will work on the X360 as well, but with less eye candy. That's what I thought anyway.. So if this rumor is true, then I guess it does have to do with that forwards compatible thing..

Link to that forwards compatible thing:
http://xboxevolved.e-mpire.com/article/3rd_generation_Xbox/4902.html