Work on Microsoft's rumoured smartwatch is now being handled by the Surface team, according to The Verge.
The blog, citing sources familiar with Redmond's plans, said prototype testing is underway.
The news follows April reports about a possible touchscreen smartwatch from Microsoft. At the time, The Wall Street Journal revealed that Microsoft was preparing its own Apple iWatch competitor — a touch-based, watch-like device with a possible 1.5in screen.
Meanwhile, AmongTech last week reported that the device will come with interchangeable bands, available in a variety of colours, including blue, red, yellow, black, white and grey. The prototypes are housed in Oxynitride Aluminium — an 80 per cent transparent material that is four times harder than glass.
Microsoft declined to comment on the rumour.
According The Verge, the prototype was previously handled by teams who worked on Xbox accessories and the Kinect sensor, but the move to the Surface group aligns with a recent organisational shift that combines the two departments. That switch made Julie Larson-Green head of the devices and studios engineering group, which covers "all hardware development and supply chain from the smallest to the largest devices we build," according to Microsoft CEO Steve Ballmer.
The unnamed device is being tested with a modified version of Windows 8, with the intent of integrating it into other Windows-based devices, The Verge said. Among Tech added that some prototypes include 6GB of storage and LTE support, with a reliance on cloud storage.
Microsoft's foray into the smartwatch platform dates back to 2002, when the company introduced the Smart Personal Object Technology (SPOT), designed to allow any number of items to receive FM transmissions delivering information like news and weather.
Redmond even constructed its own prototype wristwatch to show off the platform. But the technology never caught on, and by 2008, SPOT was just another failed gadget.