Microsoft has been hard at work making the Xbox 360 more than just a gaming console, adding a host of video options and apps alongside features such as the new SmartGlass and a web browser. According to a report from The Verge, come next year the company will continue to push in that direction, except with a two-SKU strategy that will see the arrival of a lower-priced ‘Xbox TV’ for those interested only in streaming and casual titles, not the core gaming functions.

The device is expected to arrive ahead of the 2013 holiday shopping season alongside or shortly after the next-generation Xbox game console hit store shelves. Hardware specifications aren’t fully locked down at this point, but the report says it will use a chipset to enable an "always on" device that boots quickly to provide near-instant access to TV and entertainment services.

The device is said to run on the core components of Windows 8 -- it’s unclear if that means Windows RT or a custom version to fit the form factor like it’s supposed to be the case with the rumored Xbox Surface tablet.

We’re also curious about whether such a device would require an Xbox Live Gold subscription, which costs current owners of Xbox 360 consoles $50 per year to access most of its entertainment apps, even those that you pay a separate subscription for like Hulu Plus and Netflix.

The so-called Xbox TV is said to be part of a broader effort to make the Xbox platform scalable enough to run on a number of devices. We’ve already head about a gaming oriented tablet, as mentioned above, while other ideas floating around include a phone capable of running a full version of Microsoft's Xbox Live services, as well as providing some functionality to TV OEMs who would like to sell a licensed Xbox television set.