According to a report on The Verge, former Xbox and Kinect staffers have for a year been working on a "wrist-worn device" for Microsoft.

The watch, which the report says began life as an Xbox accessory for fitness games, has a 1.5-inch display.

No idea on just what the device would do - whether it's still primarily a fitness accessory or more of a wearable computer - but Windows 8's "tile" system (already actually used in some watches, like the Gnomio above) would actually work pretty well.

Microsoft's Xbox team testing smartwatch prototypes with a Surface connector [The Verge]