Xbox Live Spring Update On May 16?

Microsoft's traditional spring update to Xbox Live should be coming soon, and a new report says that PayPal functionality is in the works.

Joystiq says that a source at Microsoft has sent them info and screens of the update, which will be sent out in six waves between May 19 and May 30 "to ensure a high quality deployment." The update will also feature support of the new Xbox 360 disc format.

Avatar Kinect – which will let you control your avatar with the motion peripheral – is a different update that will go out on May 27.

For more, read the full story over at Joystiq.