The remote is said to be in development under the code name "Newton," and could be ready for market as early as the end of this year. The report claims that while the hardware is still in the prototype phase, software developer kits and prototype remote units have been distributed.
The report cites rumors that Microsoft had licensed motion-sensing patents from Gyration, which aided in the development of the Wii remote, as further evidence of Newton's development.
Speculation of an Xbox remote was kick-started by a report from MTV News which claimed that Microsoft had been working on the device since last summer, citing an unnamed developer.
Though rumors have been circulating around the internet at a blistering pace, 8Bit Joystick had previously broken the news of Bungie's split with Microsoft, lending a fair amount of credence to the site's "internal sources."