Newsweek’s N’Gai Croal dropped a bomb this week, that the next gen sequel to Katamari Damacy would be exclusive to Xbox 360. Gamespot ups the ante a bit more, announcing that it will hit Xbox Live Arcade. Namco announced nothing.

One look at the above video, and a download title makes sense. Katamari was never a graphically intensive game, since so much stuff had to be on screen at once, detail remainded low. A Xbox 360, PS3, or even Wii release would be more detailed. The first footage clearly looks no better than the PS2 is capable of, meaning the game is likely limited by size for a download. There will be 4 Player online multiplayer and new levels, which all anyone wanted anyway.

And to think only 6 short months ago, Xbox Live’s Ross Erickson called the rumor of Katamari on XBLA “total crap