Intel loses out Console Chip Game


Dean Takahashi: As a new video game console war kicks off, no one is happier than IBM, which is selling ammunition to all sides. It ousted Intel from Microsoft’s Xbox 360, which is set to make its debut in the fall. IBM also will supply chips for the next-generation Sony and Nintendo consoles that go on sale in 2006. “It’s a master stroke for IBM to get into every console,” said Jon Peddie, president of Jon Peddie Research. “Just like that, Intel is out of the console business.” More here at San Jose Mercury News.


Jack Krupansky

Intel should be applauded for maintaining a laser focus on enhancing and protecting their (and shareholder) profit margins. If IBM wants to waste shareholder money in pursuit of an ego trip (“IBM Inside”), shame on them.

How on earth does this move into the game console sector benefit IBM overall? What leverage does it provide into other, more profitable markets?

Does Intel has their eye on some other, more profitable, portion of IBM’s processor chip market?

— Jack Krupansky

Sam Sugar

More interestingly, for broadband in particular, is that the new consoles don’t share a next generation media format. Sony, of course, is pushing Blu-Ray but the clear indicator seems to be that the format won’t matter because bits are bits.

I think HD-DVD and Blu-Ray aren’t going to be anywhere near as big as DVD. People are going to download their content and use discs to burn copies.

That both HD capable next gen consoles have differing media requirements whill make that more certain. Why ship two flavors of DVD at vast expense when you can distribute online for free peer-2-peer?

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