, Sony Corp. and Nintendo Co. all take the wraps off their next-generation game consoles.
But the biggest winner may be IBM Corp.
For the first time ever, all three gaming consoles --- Microsoft's Xbox 360, Nintendo's Revolution and the successor to Sony's PlayStation 2
--- will be powered by microprocessors from a single company, IBM.
IBM designed the chips , each different and unique, primarily in Austin, Texas, where about 6,500 people work mainly in software, hardware and semiconductor design. The chips will be produced at IBM's East Fishkill, N.Y., factory and by third-party suppliers overseas if needed.
"Obviously it's a significant win for IBM," said Brian O'Rourke, a senior analyst with technology research firm In-Stat/MDR, "especially given the stranglehold Intel
has on the PC market.... This is going to be a good [market] for IBM to sell more chips."
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A PowerPC-based chip also will be the main processor in Nintendo's new Revolution console, which will debut at the Electronic Entertainment Expo gaming industry conference this week. IBM has worked with Nintendo since the mid-1990s, and its chips currently are at the heart of Nintendo's GameCube
machines.
A new chip called the Cell processor, designed in a joint venture between IBM, Sony and Toshiba , will power the forthcoming consoles from Sony. The No. 1 game console maker showed off the successor to its PlayStation 2 on Monday, the eve of the conference.
Microsoft's console is scheduled to hit stores in November, while Sony and Nintendo are expected to start selling their new machines next year.
For IBM, the week's announcements mark the end of a lengthy courtship with the game makers and the rise of a promising new era for Big Blue's semiconductor business, long overshadowed by PC chip makers such as Intel and Advanced Micro Devices Inc.
IBM is well-known within the semiconductor industry for cutting-edge chips. Its PowerPC chips also are used in the Mars rover vehicles, some of the most sophisticated business workstations and Apple Computer Co. machines. But the game consoles will take IBM chips more mainstream.
IBM will likely ship tens of millions of chips to the three game makers over the life cycle of the newest consoles, typically four or five years. That's substantially more chips than it ships for any other product.
"It's our largest growth area" within IBM's microelectronics business, said Lisa Su, vice president of technology alliances for IBM's chip business.
"When you think that in 12 to 18 months or so we'll be in 100 percent of new boxes," she said, "you realize that it's a very [promising] segment for us."
Su said IBM's biggest selling point for the console makers was its ability to design and develop custom processors.
In the case of Sony, for instance, chip designers spent about nine months just thinking about what the company wanted to do with its newest PlayStation before they started figuring out how to make it happen, she said.
At Microsoft, Xbox designers were looking for a way to take their console to a new level with a customized chip, said Peter Moore, vice president of worldwide sales and publishing for Xbox.
"In the current Xbox, we used somewhat off-the-shelf [Intel] chips mainly because ... we had a very short timeline from inception to bringing it to market," he said. "We had no time to develop customized chips."
Moore said Microsoft wasn't concerned that IBM already was committed to making chips for the new Sony and Nintendo machines.
"IBM is a world-class corporation that can segment [intellectual property] from one group to another," he said. "We have no worries about the elevation of confidentiality with them."
Customizable chips also were important to all three game makers because each has a slightly different objective with its machines, Su said.
Microsoft is emphasizing Internet connectivity with its new high-definition Xbox 360, as well as other entertainment features such as the ability to connect to home computers to play music and show movies.
Sony's new PlayStation is expected to introduce a new high-definition DVD technology, called Blu-ray, along with all sorts of ways to connect with other Sony electronics such asMP3
music players and digital cameras.
Nintendo, meanwhile, is sticking fast to the gaming business. It was looking mainly for ways to better display graphics, speed up the processing power of its GameCube successor, and make it more user-friendly, withwireless controller connections and other features.
"All of these [companies] are looking for a way to differentiate themselves from each other," said IBM's Su. "What we offered them is sort of a bag of tricks in terms of processor technology ... that they could pull from to differentiate their products."