ATI comments hint at progress on Xbox 2 hardware

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ATI comments hint at progress on Xbox 2 hardware

Rob Fahey 16:31 08/09/2004
Graphics specialists "winding down" work on Xenon parts

Comments made by ATI Technologies' CFO Terry Nickerson at a conference
in New York this week have suggested that the company's development
work on the graphics unit for Xbox 2 is nearing completion.

Speaking at the Smith Barney Citigroup 2004 Technology Conference,
Nickerson made a short comment about the firm's involvement with
next-generation console development for both Nintendo and Microsoft.

"The other one that's starting to become, I think, a factor when
you're looking at it from an investment point of view, are game
consoles," he told the conference. "We're actually winding down
development on some of the Microsoft product. Both Nintendo and
Microsoft will be royalties."

While the comment is arguably open to different interpretations, the
most likely meaning is that the design of the graphics part which will
be used by the next Xbox console is almost complete, and is ready to
pass off to the manufacturer - where, of course, a whole new set of
challenges will have to be dealt with before the system actually
enters production.

This would tie in with the expected schedule for the launch of Xbox 2,
which is expected to hit retail well before the end of 2005 in North
America at least. It also suggests that developers, who are currently
developing Xbox 2 titles on prototype development kits based on
PowerMac G5 systems, could start seeing more advanced Xenon
development hardware around the start of next year, if not sooner.

The comment also confirms that Nintendo, like Microsoft, will be
operating a system whereby it licenses technology from ATI and
manufactures it itself - hardly a surprise, admittedly, since this has
been the nature of most of Nintendo's previous technology deals,
unlike Microsoft's Xbox deals which saw it buying bulk volumes of
technology it did not own from firms such as NVIDIA and Intel.