What's most interesting is not that the report comes from what the Verge called "a reliable source," but that said source was familiar with Microsoft's Xbox plans. Why the Xbox team?
The teams working on the smartwatch are those who have worked on Xbox accessories and the Kinect sensor. The device features removable bands attached to a 1.5-inch touch display. That display size is in line with this week's earlier report that started speculation over Redmond smartwatch. The WSJ's sources said that Microsoft had ordered a number of 1.5-inch screens.
According to the source, one of the prototypes includes the same magnetic power connector that Microsoft uses on its Surface tablets. The connector is made up of five pins and can transmit both power and data. However, as this is only a prototype, a final design may omit the connector.
In the earlier report, not only did Microsoft ask Asian suppliers to ship components for the potential smartwatch, one executive said that he had met with Microsoft's R&D team. It is yet unclear if the software giant will commit to producing another piece of hardware.
The Microsoft rumor is just the latest smartwatch rumor to hit. Earlier, it was said that Apple is working on an iWatch, though that is a rumor. Samsung, meanwhile, has confirmed it is looking into such a device. It's also been rumored that Google -- which just released its first wave of Google Glass smartglasses -- is looking into wristable smartwear, as well.