The new Xbox could include an always-online requirement that would force gamers to maintain a constant internet connection to use all or certain Xbox 720 functions.
This rumor, if true, would benefit Microsoft if it wanted to implement strict DRM that periodically checked to see if a game was genuine or not.
It could also be an advantage when the company deals with video game publishers who want to stem or eliminate used game sales from which they earn zero profit.
However, the overall impression from gamers is that the always-online idea is terrible; there are too many ways in which a connection can go down and the Xbox 720 would turn into a home theater paperweight - more useless than the Wii U right now.
1. Not everyone has fast internet
An online-dependent Xbox 720 would put the new console's life in the hands of those with fast fibre pr cable internet.
We'd hate to think about what internet users in more rural locations have to deal with. Your writer lives in the entertainment capital of the world, Los Angeles, where we've had three ISPs, and not one of them was able to hold a steady connection.
Case in point, our Time Warner internet stopped working on a Friday and the company told us that it didn't have any workers in the vicinity to fix it until the next week.
Turns out there were workers (at that exact moment) on the side of a building who mistakenly disconnected our internet while trying to repair a neighbor's botched connection. This blew up on Reddit.
These are the guys we would be relying on to keep an Xbox 720 alive?
2. Did they forget SimCity or Diablo 3
On the other end of the connection, consumers would also have to rely on game companies to keep their servers running 24/7.
Two bungled video game launches come to mind over the last year: SimCity and Diablo 3. Both highly anticipated games launched with always-online DRM, and in both cases gamers were unable to play the games they had just spent money on.
Activision Blizzard, on the other hand, was forced to issue Diablo 3 refunds in some countries due to gamers' inability to play online-dependent the game at launch, even in its single-player form.
Can each new game release guarantee problem-free servers at launch?
3. 24-day PS3 outage, Xbox Live outages
We're coming up to the two-year anniversary in which PS3's online network went down for an astonishing 24 days, with Sony providing little information on the subject throughout the ordeal.
It happened the same week that the system launched high-profile games with online components, including SOCOM 4: U.S. Navy SEALs and Mortal Kombat. Nowhere on their boxes did they say "Must have to wait three-and-a-half weeks to play online."
It also took Sony 42 days to bring its PlayStation Store back to life.
Xbox Live hasn't been without downtime, too. Microsoft's online subscription service experiences a brief outage at least once a year, and it resulted in the company issuing a free game for everyone's troubles a few years ago.
Even routine maintenance would be a problem if it prevented Xbox 720 owners from accessing certain content on their device. Does this mean that the hours during every maintenance window the console turns into a brick?
4. Now trending: #hacks
While some might argue that it may be the best thing for your brand, hacking events aren't all that great for consumers looking for a little entertainment.
Denial of service attacks could have Xbox 720 in its sights and take it offline one day, resulting in a gimped console experience for however long it would take Microsoft to repair its system.
During any such downtime, it could lead Xbox 720 looking to another console...
5. PS4 won't have it
The biggest reason Xbox 720 shouldn't include an always-online component is because its chief rival, PS4, won't have such a foolish requirement.
The internet is littered with comments about Xbox 360 owners willing to jump ship and pick up a PS4 if Microsoft does indeed launch with an online-dependent Xbox 720.
"@Xbox always online xbox 720 wouldn't allow me to bring my console to my cabin. Thanks for making a lifelong xbox owner into a ps4 owner," tweeted N1ch01s to the official Xbox Twitter account.
Ultima_Fate also spelled out his next console fate on the social network, tweeting, "I love Microsoft and xbox, that being said, you go online all the time with the 720 I'm buying the ps4 #thinkhard"
The backlash, even if the online-only requirement doesn't include games, could make loyal Xbox owners give PS4 a second look.
Yes, Sony is often criticized for taking forever to match what Microsoft has already implemented, whether it's adding game achievements or accessing its online store through the web.
However, an always-online console requirement is one Xbox-only feature in which no Sony fan will be complaining about if the rumors turn out to be true.
The best approach
Everyone gets it. Piracy is a never-ending battle, and losing money to the GameStop bargain bin is a bummer.
But there's a middle ground between open access and stringent DRM. I'd rather have heard the rumor that Xbox 720 checks to see if content is genuine during a reasonable 30-day period, not every three minutes.
Of course, now that Xbox 720 has been tagged with multiple reports of an always-online requirement, including one from its own employee, Microsoft should set the record straight.
It cannot wait until the expected May Xbox 720 launch event.
There are too many side-effects to always-online: having terrible ISPs due to unchecked monopolies, relying on publisher's undependable game servers, and the threat of hacking incidents.
None of these are good for consumers and, in the long run, will only hurt Microsoft's bottom line.