After seven years of its release, Xbox 360 is still the hottest selling console for 18 consecutive quarters. However, the sales are declining and only a new version, which is expected to debut next year, can lift up console's sales. Wedbush Securities predict that the new console, dubbed Xbox 720, could cost as low as $100 on a contract for U.S. buyers.

Michael Pachter, a gaming analyst with Wedbush Securities, predicted that Microsoft's next Xbox will act as both gaming console and cable box. The analyst predicts that the upcoming gaming console will cost $100 with TV subscription contract.

"Console will have to be multiple purpose devices, though. The Xbox 720, this is my prediction, is going to be your television as well [as your game console]. You'll be able to tune into television through it," Pachter said in a statement to INC Gamers.

The analyst claims that Xbox 720 will have open architecture and will be able to hook up with as many screens as user have. Microsoft will follow a smartphone like approach with its upcoming gaming console to launch it at a subsidized price in U.S. The only difference will be that the company will be partnering up with TV service providers instead of network carriers.

"I'm pretty confident that in the US Microsoft is going to partner with a cable TV provider, so I expect that the console will be priced like a smart phone. I expect you'll be paying $99 for the console with a cable TV subscription," he added.

Last month, an Xbox 720 document, consisting of 56 pages, leaked online to Scribd. However, the document was removed from the Internet following a request from Microsoft's legal firm Covington & Burling, but it revealed a lot of specs about the upcoming console.

If the leaked document is to be believed, Xbox 720 package will include an improved Kinect sensor with multi-player support up to 4 players. The console will support cloud streaming to access user's media library from anywhere. It will include blu-ray disc drive. The document also indicates tablet integration for the next Xbox, which is likely to be company's recently unveiled Surface tablet.

According to the document, Xbox 720 will launch in the holiday season next year with a price tag of $299.