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Microsoft seems to have started diversifying or rather bring services and different hardware than just sticking to ONE DAMN PC. After recent launch of Surface with lively Windows RT, Its being reported that Microsoft might come up with tablet like device or call it as xbox gaming tablet which will be more concentrated towards gaming which at first thought sounds like an heavily expanded version of XBOX SMARTGLASS.
If this actually comes out, its definitely going to do something more than Smartglass which can be imagined to fill in the gaps of Smartglass. As an example this could be an accessory like Kinect which provides additional functionalities like Playing a Driving Game using the accelerometer, Showing Maps to a level where you can view what your friends are looking at, advance voice navigations etc. But whatever it does, it does not definitely looks like to be replacing controller by a long range.
Another guess that can be made is that it can compete with portable devices like PSP which is more oriented towards anywhere playing experience. Now since this hardware will be more dedicated towards gaming, one can easily guess Microsoft bring in more types of gaming content rather than just sticking to Xbox and PC.
As reported on Verge, it seems Microsoft has locked down many units of Game development section which is strong hint Microsoft could be up to both developing the next version of Xbox with some new accessories.
Xbox Surface Specs
If you check out the Xbox Gaming tablet specs, its really impressive. It not only has powerful 28nm GPU but has 2 powerful with 6 cores. What really impresses me is that it has massive 250GB of space which is found in Xbox bigger version, giving ample of space for users to install and play games.