360 dash update due this month report

New disc format, Avatar Kinect incoming.

The latest Xbox 360 system update goes live later this month bringing with it support for a new disc format and Avatar Kinect, according to a Microsoft leak.

Someone claiming to be a Microsoft tech support employee let slip an internal memo to Joystiq stating that the update will start rolling out from 19th May.

The main tweak to your hardware is support for a new game disc format known as XGD3. First hinted at earlier this year, it allows for additional storage space and further layers of copy protection.

The only "user facing" update is expanded PayPal support for new international markets.

The update will be distributed in six separate groups between 19th and 30th May "to ensure a high quality deployment." There's no word yet on who gets it first.

The mole also offered up another internal document showing that Avatar Kinect a free virtual chat room unveiled at CES in January - follows soon after on 26th May.

We're onto Microsoft for a confirm/denial and will update when we hear back.

How Avatar Kinect reads your face

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