A new report on the Verge is claiming that the Xbox handheld console is toast. Or to quote directly, "it's essentially canceled". That initially seems confusing, after all hasn't the first Xbox handheld only just been announced?

Microsoft and Asus have been collaborating closely on these two new Xbox Ally devices over the past year, and Yen says Microsoft and Asus “share a joint obsession” on these new handhelds.