From what I can ascertain (read), they (MS) have been working towards the reduced 45nm chipset with the Valhalla, as I've seen some pics showing the actual difference of the chipsets. So if they are in prototype phase now, it's fair to assume that the Motherboard which follows Opus (the one after Jasper (current NEW motherboard), ie Valhalla will have some advance tech on board.

MS own the rights to both the CPU and GPU this time around,unlike the 1st-gen xbox. Which as pointed out, was simply a foot in the door approach for both developers and gamers alike. It had a job to do, it did it, just like the first version of the Playstation did, remember it, but the main firing power is the current 360, with the x720 coming online most likely March April '10 which is when they "say" a new game may well appear. Their two major delivery times are Nov and March/April of each year. So if it is to be in '09, it will be Nov.

Larrabee will be very very interesting. It is possibly going to change the way we make games. Raytracing all in real time. The core is a pentium like chip which will be way more powerful than a powerPC chip. Then they have some crazy FPU on board with plenty of ram or cache.

Intel is very scary they know what they want. The next big thing I'm hearing about is mostly polygon shaders. Every thing we've worked with so far has been texture based shaders mostly. Plus too the little core in this chip would have branch prediction. I mean you really could have competiting AI's running on a set of different chips just off this GPU hybrid if your smart enough.

Man I'm very impressed at the brute force attack of AMD/ATI with the terrascale but intel has not given any one too many targets on what it will actualy have on board. Intel is trying to get this chip in any console which actually includes nintendo and sony. SONY isn't going to waste money or too much money on the next upgrade and I expect them to be the next Wii or PS2. Nintendo would only put this chip in their next box if they can have a $250-$300 package with some games and some cool controller. From what I'm hearing the PC guys want no part of this new chip because they can not build upon their million dollar bag of tricks. This makes sense but it puts a company like epic in a bad place because if this is the future then they will have to start over like every one and Nvidia will not be there to help them. Yet intel crushes every one even IBM it seems in writing very capable compliers.

Seriously Intel is a very scary company. I use to love some AMD and all of my old stuff was from those guys and I was thinking they would keep trying to fix what they have but they just brought the hammer down on AMD. I know there are a lot of GPU fanboys more than console fanboys actually. Yet they use the brute force model of bigger badder.
The one reason why I had hope for the cell was because a new way would have to seriously be consider. Thanks to sony gimping the chip those hopes are gone and now they lay with intel with the Larrabee project which is going to show it's face in 09 and the AMD/ATI project Fusion which is basicly close to the same idea.

I don't know about backward compatibility with intel's approach but I'm thinking the old chips for the current system can be put onto one die and installed as a daugther chip near the frame buffer for each of these new consoles so you effectively can do some post effects with the old hardware or just run the games from the old chip with the possibility of line doubling AAx16 etc. If these guys are planning their next systems correctly they can tell the programmers to have a performance scale built into each game with the setting saved with the game save.

This is very hard to predict because if SONY and MS stand still this gen nintendo will be there because the chips that out put those graphics will be pretty much what we will be running in cell phone by that time, due to the possibility of die shrinks and power save tech. Yes I know it would be over kill but it's just an example. The problem is at such a low price I'm wondering if games or tech would sell, yet if nintendo has the same tech then that would only hurt SONY and MS more.

The even crazier thing is the Wii is pretty much a self contained system on a chip now which is why they saved so much money on it even though it is using ram way faster than most computer systems. ATI could just make this a full GPU/CPU hybrid and up the clock and ring bus a bunch of chips together to produce HD graphics. I mean a Wii that is part terrascale chip and Wii would just be crazy.

I mean we are getting into really unknown territory here because these are not gimped chips when compared to what is in the cell. Then again we do not know what IBM is coming. They have won the game industry this gen and I don't think they will be looking forward to letting that go. Man so that means we have a real battle between IBM, intel, ati/amd, and Nvidia WOW. Now that's a next gen war right there tech wise.

Jake, great points. Seeing that you're open to discussion on it, unliek some . cough cough . . I'd like to point out one area of info many have forgotten about, and not many knew about.

During the initial planning phase of the 360 and for that matter, the xbox platform, Ballmer and Bach both came up with a figure that the company could well lose without suffering too much . . and they were prepared to "do what it takes" even at this $$ loss.

That figure was. $US6.2 billion over 7 years. (source is Xbox 360 Uncloaked) so cutting loses would fit in,but I agree, the $199 figure is for the arcade, which they will eventually drop in favour of the Elite, but in Pro cloths.

They wanted to know at a worse-case-senario what could they lose before they started to pull in the purse strings, that was the figure they put up in 2002. They are now ahead on production profits, but running even on sales. So basically one cuts the other out. They make their $$'s from the huge attachment rate which is reportedly at 8:1 at the moment.

Far greater than both Nintendo and Sony. Sony are losing money all the way to the bank and back again. They admit that, and they admit they will never make it turn a profit, in its lifetime. But that does not rule out Sony making a profit with their next iteration.

So yes, it would sound and be foolish for a "normal" company to do such things, but we are not talking about a normal company here. MS have the highest liquid assets out of all 3 majors with cash reserves in excess of $US32 bil, while Sony's cash reserves are under $US5 bil.

SO you can see they (MS) have a decent amount to play with in that regard, and can "afford" to carry a lose into the next iteration.

My "predictions", for what they are worth, is, that MS will drop the Arcade, they will merge the Elite into the Pro by adding the 120 gig HDD which is basically the only difference now. They will include a slot driven optical drive in the x720, but one along the lines that Apple are using.

The x720 will launch late '09 or at the latest, April '10 alongside a "major" MS franchise to carry its introduction.

They will have Digital Download as their main delivery services in Nth America and Europe, which is why they have teamed up with BT in Europe to delivery movies now. But they will still need a disc drive for 80% of the world who do not have the broadband capacities that both Nth America and Europe do.

Your mature reply is welcome XboxOZ360, and you seem well versed in Microsoft's financial strategy, so I cannot argue on these points. I can well believe that Microsoft has higher cash reserves than Sony, and it makes sense to likely use them for the purpose of enhancing brand perceptions (with products like the Zune and the XBox line), even if it means a short-term loss.

Heres where things get tricky. I can well see the 720 launching in late 2010 (~Nov); this gives the 360 5 years of exclusive life with the potential for several more, quieting the fanboys, and could place Sony in a very difficult position of having a rival launch their new product several years before the PS4, solidifying the 720's market share. Anyone who studies business can see this is a great strategy for Microsoft, but a strategically difficult position for Sony. Hence, I suspect Sony really DO mean they intend to have a 10-year lifespan. They are smart enough to see this coming.

But to launch in 2009? Like you said, they make their $ from their attachment rate. Microsoft have little in the way of internal studios, compared to Sony. And while they enjoy strong 3rd party support for the 360, I am curious to know how they intend to show the 720 is a significant step up from current consoles to warrant splashing out a premium price for one.

3rd party publishers look to maximise their profits by developing high profile (and therefore expensive) games on console(s) that have already have a high user base; Microsoft might have the cash spare to afford a loss, but I doubt 3rd party publishers do. Which publishers would take the risk so soon when a similar high profile game would sell countless times better on the current consoles whose user base numbers in the 10s of millions?

The difficult question would be what type of optical drive the 720 would include in order to be 100% backwards compatible? I am not familiar on Apple's slot driven optical drives... but a DVD drive would be the laughing stock of the industry, even Microsoft knows that. The only real (current) alternative is a Blu-ray drive, which would push the costs skyhigh, as I believe it is the single most expensive bit of hardware in the PS3 (although I stand to be corrected).

Still, this conflicts with Microsoft's repeated claim of DD being the future, although as a resident of your neighboring country, I agree that to not include any optical drive would cost them more market share than even Microsoft would be willing to take. I maintain that launching the 720 in 2009 is too soon, they risk angering their fan base at a time where many countries will still be recovering from recession, and at the exact time Sony is using their impressive 1st party studios to showcase system selling games such as God Of War 3 and Grand Turismo 5.

The $199 box is not a reaction to anything, it was there roadmap all along.

Mate, you really don't understand do you.

They can NOT wait until 2012 for a new xbox. They have scheduled it for the Valhalla in 09/10, most likely '10. While they said they could be a new tech by operative word BY 2012, they did not say OUT in 2012.

All the 'facts' fall into place for the release of the console in that time frame mentioned. Game console do NOT have the expected sale cycle as they once had, their primary life span is 4-5 yrs, with a "life span" of around 10 yrs. Meaning they will be on sale for that period, but NOT the primary SKU available.

The need to have a new version out by 2010 and Sony will have the PS4 out by 2011 or 2012 at the very latest. Again, giving it's current console a sale cycle of between 4-5 yrs.

I think you might be the one NOT reading the information, and the facts.

At least Xboxoz360 posts make for an interesting read, much better than the average N4G fanboy babble and hordes of blithering idiots like yourself.

It's a sad day when people can't be bothered to read posts, let along check a persons Bio. You'll see I'm nothing like Bruce on Games. I believe in writing what is on my mind without trying to insult others or pick side s. I hate fanbois, be they xbots or Sony droids. If half of them had a little more sense, and bothered to read just half of the posts and articles in here, the site would be a better place.

SO I'd suggest hitting that button up the top that say Bio and check it out, then do the same for Bruce on gaming. I have but one account in here, as I don't believe in having multiple accounts in order to get around a system.

Consoles do NOT need lots of memory, in fact, they work better with less, than more.

Plus, and this is the BIG thing, it also forces developers to be more creative. To look for ways around things, rather than simply allowing the system to become bloated and over loaded. Give a developer a high wall to climb over, and he'll bust his nuts in trying to do it. Give him an open field and say off you go, he'll wander all over the place using up every bit of the area he can.

Hard times or difficult tasks feed the creative juices of the creative minds in gaming, unlike some that reply in these posts.

DiCE with their Frostbite Engine found ways of applying the persistent environmental damage to Bad Company. Which would normally require more RAM. They found that if the used the cache and did a smoke-n-mirror's style of approach, they would in fact use LESS memory, freeing it up to do other more complicated calculations and effects.

It allowed them to find that way, which they will now use on consoles and PC's. Advancement for the industry.

An Australian developer has come up with a textural process that will offer multiple time great textures than the current high numbered poly counts available in games where 100's thousands of Pollys are required to render even bridges in games for the detail and clarity.

His system, using vortexual procedures allows for far less memory use, nowhere near the amount of GPU and CPU pull that the Polly made textures do, allowing the GPU and CPU to be used to great extent than they currently are.

This would not have happened if they stuffed more memory into a console. A console does NOT need more memory like a PC does. The COnsole has a basic OS, not a fully fledged OS like a PC does. It has some basic tasks, but its primary function is to load the games within seconds and allow faster transfers or data off the discs. Unlike PC's where the game has to be loaded on a huge hard drive in order for it to be played, which in turn requires more memory.

Do a little research into why they do NOT have huge memory needs and you'll understand that BIG is not always better. Just ask Apple that.