United Kingdom, Aug. 16 -- Microsoft could stop making Xbox consoles, according to former PlayStation boss Shawn Layden.

The former console chief believes that Microsoft is at a "fork in the road" in terms of making consoles and could end up replicating Sega by turning its attention to software.

Layden told Gl.biz: "Watching what Xbox has been doing recently, I do get Dreamcast flashbacks.

"I think Sega realised they were just better off being a software house. I think Microsoft is in that same sort of fork in the road. And I don't think their hardware offering is persuasive enough to make up the ground they've lost."

Microsoft leaving the console business would be an unexpected move given that the company has recently signed a multi-...