Sony and Microsoft are expected to unveil their next-generation consoles soon and the rumor mill is working overtime as usual.

According to the latest credible rumor, Microsoft's next Xbox may require always-on Kinect connection, as well as auto game installs.

Rumors about the next-generation Xbox have been making rounds for months now, but Kotaku seems to have a well-informed source known as SuperDaE. If the handle sounds familiar, it's because SuperDaE is the one who tried to sell a seemingly genuine development kit codenamed "Durango" on eBay. Microsoft shut down that attempt, but SuperDaE has now resurfaced with new information allegedly originating from white papers designed to prepare developers to work on the new system.

The final, ready-to-ship Durango console (a.k.a. Xbox 720) will pack an eight-core processor clocked at 1.6GHz, 8GB of DDR3 RAM and a "800mhz DirectX 11.x graphics processor unit." Other specs include a 500GB internal hard drive and a Blu-ray drive. So far, Kotaku's information falls in line with previous reports about Durango's internal components.

The new report, however, claims that from now on every new Xbox will include an updated version of Kinect. Moreover, reports indicate that the next-generation Xbox will not function properly unless the Kinect is connected and is correctly set up. Kotaku's report also indicates that the next Xbox will be the first console to require mandatory software installation to that 500GB hard drive. Games will reportedly split into discrete sections so they can install while playing off the disc.

While some found Kinect's performance in tiny rooms somewhat troublesome, the Kinect's appearance at the International CES and Kotaku's latest report suggest that Microsoft has big plans for the technology.

Microsoft has also considerably updated the new Kinect, and the technology can now reportedly track more discrete points on more users' bodies. On the other hand, this does not mean that the next-generation Xbox will ditch the traditional controller.

Kotaku could not figure out exactly how the console will look, but the new Xbox is expected to be a "natural evolution" of the Xbox 360's controller design. It remains unclear, however, how it will connect wirelessly to the console without changing the design too much.