Microsoft dumps Nvidia for ATI

[smegforbrain]

It looks like Microsoft has reached an agreement with ATI to provide the graphics chips for the next next-generation console.

An interesting move, since ATI already provides graphics chips for the GameCube.

Though, it'll be more interesting I think to see whether Microsoft will make a product that will actually make them some money this time around.

 

[fivefeet8]

Considering the partnership between MS and Nvidia and their current situation with the Xbox, it doesn't suprise me. Hopefully, ATi doesn't get the same deal Nvidia got from MS.

 

[nullroute]

I wounder if such a move might bring the concept of the nDreama back to life... after all that was the reason the M$ made the xbox in the 1st place and why they decisively partnerred with nVidia.

 

[Cyberman]

Well Microsoft does nasty things to everyone.. I don't think it's wise for ATI to supply components to MS, at least it looks good to investors, the problem is MS is pretty damned nasty for a business partner. I wish them good luck, they will need it.

Cyb

 

[vampireuk]

ATI has a much larger dev team that NVIDIA does so they should be able to take this on without letting in affect them

 

[fivefeet8]

Ati is taking a bigger risk than Nvidia did with the Xbox. Nvidia has a lot of funds to withstand a loss if the xbox doesn't sell well(it's selling ok, but not great). What would happen if the Xbox2 doesn't do as well and MS decides it wants to lower the price of the ATi components to lower the Xbox2 price. Console price wars gets pretty ugly sometimes. Remember, Ms is actually losing money on every Xbox it sells but tries to makes up for it with the sale of games(not working either). Nvidia doesn't get any profit from the game sales, only the components it provides.

Also, there are a lot of overstocked Xbox's that haven't been sold(1 million to 1.5 million units). Does Ati have the necessary funds to lose that much money on unsold Xbox2's? Like I said, I hope Ati doesn't get the same deal nvidia got.

I also wonder if Ati will be able to produce components for both MS and Nintendo at the same time.

It's great that Ati is finally becoming a formidable competitor in the vcard/game industry, but I hope it doesn't bite off more than it can chew.

I don't think Nvidia got dumped by MS at all. Nvidia has been distancing itself from MS recently after all the trouble with the Xbox.

Quote from news.com article:

"Nvidia has really given a lot of signals...that they're trying to distance themselves from Xbox2," Michael McConnell, an analyst for Pacific Crest Securities, said earlier this summer. "That relationship has really soured over the last year...Microsoft in general is just not a very nice partner to deal with. I think the whole experience left Nvidia with a bad taste in their mouth."