Microsoft allegedly reluctant to select AMD for next gen Xbox console contract, Intel trying to seize huge opportunity

Sources close to Moore’s Law Is Dead allege that Microsoft seems reluctant to start working on a next gen console with AMD. Microsoft apparently canceled the Xbox Elite project and the company will only release refreshes for the rest of the current generation. MLID claims that as of the past few months, Microsoft had not yet signed any contract with AMD for a next gen console, while Sony already signed multiple contracts for PS 6 and “Vita 2” handheld. It looks like this hesitation on Microsoft’s part is actually a strategy to obtain the lowest prices from AMD, with the company trying to force things by initiating talks with Nvidia and other unlikely chip makers. However, this time around, MS allegedly ghosted AMD for longer than usual, and this situation immediately sparked Intel’s interest to try and negotiate a next gen console contract.

According to MLID, Intel is very serious about this because of two main reasons:

1. CEO Pat Gelsinger sees it as a “hail Mary pass” to save the Arc dGPU business. MLID previously reported that the discrete Arc GPU business would be in a weird spot and Intel might only focus on Arc iGPUs moving forward. If MS agrees to a console contract, Intel could at least keep the dGPU business solely for the console side.
2. Intel is “desperate” to get wins for the foundry business and compete with TSMC. Intel is ready to promise unlimited production capacity, lower costs and a timely launch, while TSMC is constrained with orders from many clients and thus forced to raise costs.

MLID makes it clear that MS did resume communication with AMD in the past few weeks and the design phase may have just started, so Intel is unlikely to get selected for production. Nevertheless, a design stage this late means that MS could be forced to delay the next gen launch, which would allow Sony to be first to market.

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