Rumors about both the Xbox 720 and PlayStation 4 are making rounds on the Internet with several blogs and websites dedicated to them and their specifications. Both the companies are fighting it out even though the devices have not been officially announced and it remains to be seen what they will offer once they arrive.

Let’s take a look at how both of them are pitted against each other.

Project Development: As far as the Xbox 720 is concerned, it is broadly believed that the developers have already started to create titles for Xbox 720. Previously, the Lionhead game developing franchise had even recently posted a job advertisement where they were looking for a person with a background in DirectX 11.

It is also very well known that Microsoft's DirectX 11 has not been used in any current gaming consoles so far, and the fans are guessing that titles are currently being developed for the next-generation Xbox that will have DirectX 11 support. However, nothing is known about the backward compatibility (the ability to run the previous Xbox titles) of the device.

The PlayStation 4, on the other hand, was previously rumored to have a PS universal compatibility that would let you play all the PS model games with PSP games available for download on PSN. Currently, except a few PS models, the PS3 fails to play PS2 games although it does manage to play the first PS games which is actually quite strange.

However, new reports have claimed that the PS4 might be also called the “Orbis,” which will not be backward compatible with PS3 games, and the console will limit access to used games. Sony, supposedly, will make this happen by making new titles available on Blu-Ray or for download over PlayStation Network, and will be locking the copies to individual PSN accounts. This can be a bit of shock for PS lovers all over the planet.

Processing Power: If rumors are to be believed, the new Xbox 720 is set to pack in AMD's latest 6670 chip that supports DirectX11, multi-display, 3D and many others. Moreover, if Microsoft decides to wait until 2013, AMD's new HD 8000 series graphics chips will be available for integration in the new console.

According to Epic Games' VP Mark Rein, the new console will have more power than 360 has with technology like Kinect built into it. Thus far, Microsoft has used a custom-developed IBM Power PC with a trio of 3.2GHz cores and an ATI GPU in its Xbox 360 which was considered to be a hot technology at the time the Xbox 360 arrived.

However, the PlayStation 4 is expected to arrive with more improved specifications that will look to challenge the Xbox. Although it was previously reported that the PlayStation 3 has a processor (or Cell) which is hundred times powerful than the Xbox 360′s processor, it has also been said that the PS3 doesn't fully utilize its powers. Also the RAM and the DMA (Direct Memory Access) are actually quite poor and insufficient and just cannot support the all powerful Cell.

The outcome of this is that most of the current games are first developed for the Xbox 360 and later ported over to the PS3, and may sometimes have a few modifications. Now it is expected that the upcoming PS4 will solve this issue of the processing unit making life somewhat easier for the developers and will be able to generate maximum output for the gamers.

Controllers: It’s actually high time that Sony introduced a new set of controllers for their popular gaming console that will look a bit different from its predecessors. Currently, the only difference between the controller of a PS3 with the first PS is the color and, to some extent, wires (and also a single button added to the PS3 controller).

Although Sony may have thought that keeping the same controller would be a good idea as it would be advantageous for gamers who may get confused with the new set of controllers and the buttons on it, it can be also very tiring for the gamer to be stuck with a same controller when they had expected something different from the previous ones.

As far as the controllers for the Xbox 720 are concerned, there is still a bit of confusion as most of the fans believe that the controller for the new gaming console will arrive with an evolved look and more capabilities for next-generation gaming. Nonetheless, fans are sure that the Kinect gesture-control system will stay on the new Xbox console, with a revamped version of Kinect waiting on the horizon.

Disc Drive: One of the leading rumors regarding the Xbox 720 that has been a focal point of all the talks is that Microsoft will ditch the traditional disc drive for the new gaming console. Even previously, a UK-based gaming blog, MCV, came up with the report that Microsoft would not mount a disc drive for the Xbox 720. The Redmond-based company will rather opt for an online storing option instead of its more traditional ways.

The PlayStation 4 in comparison is expected to adopt the Blu-ray technology for its upcoming gaming console. Blu-ray is one of the most happening technologies around at the moment and it has, over the years, almost completely thrashed the DVD format to oblivion and has also proved to be a more expedient solution for the gaming industry. It has not only managed to make the games HD sharper but can also fit into a single disc, unlike the Xbox 360, where it needs a number of discs to store certain games.

Windows 8 vs. PlayStation Network: Whereas it is expected that the Xbox 720 will run on Windows 8 with Microsoft looking to add the gaming department into its ecosystem as well with an improved Xbox Live, the PS fans believe more will arrive from the network as soon as PS4 hits the market with exclusive demos and downloadable games.