Xbox One backwards compatibility rumored in the cloud

The Xbox One Cloud might not only be looking to enhance next-gen experiences, it might be the backbone for backwards compatibility on the console. Reports from The Verge suggest that Microsoft is showing a streaming functionality behind closed doors that allows Xbox 360 games to be streamed to Windows Phone and PC.

The report claims that this technology is still in the prototype stage, but latency is low and the games are being controlled via an Xbox controller attached through an accessory. While the rumors talks explicitly about other devices, it does not mention streaming Xbox 360 games to the Xbox One — but it’s not difficult to image a situation where Microsoft makes this an option for those who move on to the Xbox One.

Microsoft has been talking a lot about the cloud service that will power the Xbox One since the console was announced, but they have not addressed any backwards compatibility questions from fans. If they do in fact use the cloud to stream Xbox 360 games to the Xbox One, it would be a big win for Xbox fans, and an answer to Sony claims of backwards compatibility via Gaikai.

Sony’s doesn’t have plans to start rolling out their Gaikai initiative until 2014, it sounds like this functionality for the Xbox One is one a similar timeline.