Nvidia has reportedly begun hiring former engineers from Transmeta and is looking to develop its own x86-compatible processor core in a bid to continue its lucrative chipset business. The now-defunct microprocessor producer specialized in low-power, x86-compatible processors before turning into an intellectual property licensing firm and eventually closing doors in September of 2008.

Similar rumors have surfaced and died several times over the last few years along with speculation about an Nvidia acquisition of VIA. However, Doug Freedman of research house AmTech feels an internally developed solution is more likely and a necessity to preserve revenue from its integrated graphics solutions.

The chip maker is currently caught up in a legal battle with Intel over the scope of a 2004 chipset licensing agreement. Clearly, this is already limiting its ability to sell chipsets and it's only expected to get worse for Nvidia once Intel and AMD start including graphics functionality onto the CPU die. The company knows this and has been looking into x86 development for some time, saying it is not a question of ‘if’ but ‘when.’