There's a multibillion dollar company moving into the chip business: Microsoft.

According to sources, the Redmond, Wash.-based software giant will more actively participate in the design of the brains for the next version of its Xbox gaming console, tentatively called Xbox Next. By switching from using relatively standard parts to more customized silicon, the company can better optimize its game console, due in 2005. At the same time, the move potentially gives the company a toehold in a completely new market.

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