Microsoft to start its own chip design lab for new xbox

http://www.engadget.com/2006/10/21/microsoft-to-start-its-own-chip-design-lab-for-new-xbox/

Microsoft is opening it’s own hardware outfit that will design chips for future 360’s or 720’s??. I wonder how much crucial knowledge they gained from working with IBM on how to create chips that run games smooth. I know they won’t be able to make their own GPU’s and with the consolodation happening in the chip outfits they are probably trying to avoid future price hikes.

I wouldn’t be surprised to see Microsoft start producing other items like it’s Zune music player if it doesn’t flop.