Dating back several months, there have been rumours surrounding Microsoft's next-gen console plans. We know that there is a small army of first-party studios preparing new games and at one point, Microsoft was planning to launch into next-gen with two consoles at once, one being a higher power version at a higher price tag and the other being a more sensibly priced option. Since then, it looks like plans have changed, with plans for the second console being scrapped for now.
Scarlett and Lockhart were the two codenames for Microsoft's next-gen consoles. At E3, Project Scarlett was officially announced, although specific performance details are being kept under wraps for now. According to Thurrott, Scarlett is now the only console Microsoft is working on for 2020, leaving Lockhart behind.
This doesn't necessarily mean that a cheaper next-gen Xbox won't arrive later down the line. After all, we are used to ‘slim' designs coming in a couple of years after the main console launch, usually at a cheaper price compared to launch models. This will avoid potential confusion though, as shoppers will only need to decide between a next-gen PlayStation, rather than a PlayStation and two offerings from Xbox.
Sources speaking with The Verge confirmed that Lockhart plans were actually scrapped “many weeks ago” in large part due to concerns from developers about the increased focus on xCloud over natively running games. This has now been dialled back, with Microsoft going all in on hardware and focusing on smartphone streaming for its xCloud efforts.
KitGuru Says: Scaling things back to just one next-gen console seems like a smart move. The market was mostly receptive to the idea of a high-power console refresh mid-generation but launching with two different SKUs right out of the gate could get messy.