A juicy rumor from SemiAccurate indicates that production for the initial run of Xbox Next devkits has already started, with units expected to arrive at select studios by March or earlier. Although details have not been finalized at this stage, it appears Microsoft will be using some variant of the Radeon HD7000 series in its next box, which is built on 28nm process technology.

Power consumption matters, you can’t lump a 250 watt GPU in a console so it’s likely Microsoft will be using a chip that fits somewhere in AMD’s midrange lineup, rather than a top-end part like the just-released HD7970.

Even if production of dev hardware has started, the release of the Xbox Next is still a ways off. SI expects production on consumer units to begin in late 2012, with a release in 2013. That means we could still see it at E3 2012, so as long as Microsoft’s partners have something to show, and with dev kits reportedly rolling out it seems they will.

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