Time to start selling X-box's on Ebay.

[slade]

Because they might soon be as extinct as the Dodo.

http://mwprices.ft.com/custom/ft-co...1E81954E91B4%7D
Nvidia ends shipments of chips for Xbox
By Chris Nuttall FT.com, 00:04 BST May 13, 2005

Nvidia, the graphics chipmaker, said on Thursday it was ending shipments of chips for Microsoft's Xbox game console in the current quarter as what was once one of its biggest customers moved on to its next-generation machine.

Microsoft is expected to release the Xbox 360 in November, featuring a graphics chip from rival ATI. Microsoft had informed Nvidia it would not take any more product after Nvidia's second quarter, ending August 1.

The news was a clear indication that Microsoft was cutting off production of the old Xbox and of the imminent release of its successor. In contrast, Sony is still selling its original PlayStation console several years after the launch of the PS2.

Nvidia's inclusion in the original Xbox, launched in 2001, had been a major boost for the Silicon Valley company, but other areas of its business have since grown and Microsoft is no longer one of its top-ten customers.

An Nvidia chip will feature in the PlayStation 3, expected next year, and the company said revenues from that would begin to flow in after the technology licensing started in the third quarter.

The graphics company reported record sales in its first quarter ending May 1 of $583.8m, up 24 per cent on a year earlier. Net profits were $64.4m or 36 cents per diluted share, compared to $21.3m or 12 cents a year earlier.

Analysts had expected sales of $579.7m and earnings of 28 cents, according to Reuters Estimates.

Nvidia said there had been 20 per cent growth in chip sales for high-end PCs and its next-generation GPU (graphics processing unit) was set to be unveiled at the E3 computer games trade show next week.

The company said it had been forced to write off handheld inventory after Motorola cut its orders for chips for 3G phones as demand failed to meet expectations.

Nvidia expected the handheld segment to return to growth in the second half. It was bullish on the current quarter, usually the seasonally slowest with sales down 5 to 10 per cent on the previous quarter. Instead, Nvidia forecast sales would be flat to slightly up.

Nvidia shares rose nearly 9 per cent in after-hours trading to $24.75 on the news.

[theWacoKid]

Classic. As in a classic piece of stupidity. Really effin dumb. A lot of people would have been content with the xbox and the current software lineup, now, MS is going to force would be xbox owners into a next gen console whether they like it or not.

Sony has the right idea, keep selling the ps2, because for a lot of people, that's all they need and by this holiday season, a $99 ps2 is a virtual lock. With no xbox around to be had, sony will clean up at the low end and the cube might see a nice rebound as well with the new zelda.

MS is risking way too much on xbox 360. If it doesn't sell, what do they do? They're basically screwed. I'm behind on the west coast, so I haven't heard whether 360 is b/c or not.

That's pretty funny, their shares went up 9% on the news.

[Darwin]

I'm behind on the west coast, so I haven't heard whether 360 is b/c or not.

And neither have I. Funny thing is that I just watched the MTV special on Xbox 360. You'd think that after that I would have all kinds of useful info on the console, like backwards compatability, HD, release dates, controllers, games, etc. Nope. That was 30 minutes of my life I will never get back. It's the equivalent of MS slipping me some Roofies and me winding up on my couch naked and confused as to what happened.

[theWacoKid]

Check xbox360ign.com, they have some info. A detacheable 20 gig HD will be standard supposedly, but no b/c in sight. This is what they had to say.

Will Xbox 360 be backwards compatible?
The problem with backwards compatibility is that the original Xbox ran on an nVIDIA graphics processor. When software makes calls to a chipset to produce visuals it uses code specific to that hardware. Xbox 360 runs on an ATI graphics chip meaning that code from last generation games will need to be recompiled or emulated in order to work on the system. Does this mean that consumers will have to chuck their beloved Xbox libraries? Not necessarily. There is a chance that Xbox 360 will have the ability to emulate the old system, though nothing has been announced as of yet.

Doesn't sound good, now does it, and I think you can kiss it off. MS is going to look to bury the xbox as quick as possilbe and move on with the new system and act as if the old system never existed. Xbox what?

[Mochan]

PC games run on both ATI and NVidia chips. It's not a big deal. Anything the old Nvidia chip could do, the new ATI chip can do easily. I'd say a few drivers writes and an emulation core engine is all it takes. If they wanted to include backwards compatibility, they can do it.

I still don't see the big deal with backwards compatibility, but I guess a lot of people find it important. Personally, if I move to a next gen console, I'll never look back (well, barring a few exceptions, VERY few exceptions, but I wouldn't miss my "old beloved game library" at all). You don't see me playing FamiCom games in this day and age. I don't even play PS1 games anymore. Why bother? I got PS2 games to play.

[trebor]

The news was a clear indication that Microsoft was cutting off production of the old Xbox and of the imminent release of its successor.

Oh...oh...oh...but I thought that M$ was going to support Xbox1 until 2007!! Surely, if M$ was intending to support Xbox1 still and continue to release games for it they would still sell the thing, right? :p

[theWacoKid]

This is from gamespot and it shows you how little analysts wind up knowing.

GameSpot: What's your advice to Microsoft: discontinue the original Xbox with the 360 launch, discount to $99, or maintain pricing for the foreseeable future?

Cole: Sony had great success extending the life of the PSOne. Microsoft has a nice tool to market to consumers with Xbox Live. If they can get budget-conscious consumers to try the Xbox at $99, that could be a great way to get them into the brand and ready to step up to the next level.
Pachter: I'd suggest that they maintain pricing and look to redesign the box (as Sony did to its PS2) so that they are in a position to cut price. There are tons of people out there from middle-class backgrounds who don't have a box yet, and it would be smart to try to make the current-generation Xbox a "starter kit" for the next gen by winning more converts.
Markovich: We currently see that consumer demand for the current Xbox is still strong. We expect Microsoft to continue to support the current console for several years.

Doesn't look like any of that is going to happen. I think this is a sign of MS's major arrogance, that it can just dump a console and move on like nothing happened. Not everyone wants or can afford a next gen machine. Big mistake they will regret imo. MS is going to be shocked this xmas as to how many ps2 and gamecubes get sold.

[GameLegend]

Kinda reminds me of the Atari days..Big corporations then: Warner Bros.