X-Box to Play Dreamcast Games?

Gamers.com has the scoop, reporting that credible sources told the site that Microsoft's upcoming gaming console the X-Box will in fact be able to play Dreamcast games. Those same sources told Gamers reporters that the DC chipset is already incorporated into the X-Box, though no official confirmation has been made. The announcement of the collaboration between Sega and Microsoft is expected on the first day of the Tokyo Game Show at the end of March.

At this event Bill Gates will deliver a keynote address in which he is expected to officially announce Dreamcast support for the X-Box. One Gamer.com international reporter wrote earlier this week that Microsoft hinted a huge developer for the X-Box was still unannounced, the only developers fitting into this category being Sega and Square.

For those of you who have been following the story, this makes sense, as Sega recently announced that it may drop Dreamcast production all together in favor of software development. X-Box compatibility would fit well into the scheme of things.

A few weeks ago rumors circulated that Sega was in talks with Nintendo, who also just so happens to be based in Redmond. Gamers.com reminded us of this fact, and writes "The NY Times fingered the wrong Redmond giant. It was not the Redmond-based Nintendo making repeated trips to Sega HQ; it was the Redmond-based Microsoft."

For more information read the article at Gamers.com.

UPDATE - Thanks to one BetaNews reader who pointed out a story on the Daily Radar. One Microsoft spokesperson told the site that the rumors were "absolutely untrue," and Sega of America representatives backed that claim as well.