00:00 Speaker A

It's time for Tech Support, our weekly deep dive into all things technology. And this week, could a new chip maker be attempting to dethrone gaming giant Nvidia? AMD and Xbox announcing a new hardware partnership for their upcoming consoles. Yahoo Finance Tech editor Dan Howley is here to break down what we know so far. And Dan, how big of a deal is this for AMD?

00:20 Dan Howley

Uh, it's a big deal, right? Usually what happens is these companies come out and they say, okay, we have a an agreement to produce a console, right? But that's not what uh Microsoft and AMD are announcing here. They're announcing the next generation console, the next generation Xbox for the home, and then the next generation of handhelds, and then anything else, really. They kind of made it very broad saying it's a multi-year agreement. Uh, a lot of this ties back to Microsoft's want to get consumers to use its Game Pass service, which is its online gaming service where you're able to download games, stream them from the cloud. Actually, it's shocking how well that works. Uh, and get access to as many games as you want that that are available there. It costs between 9 and 19.99 uh a month, not a bad uh amount of money for what you're getting. Uh, and instead of a one shot where you, you know, you buy a console, you have recurring revenue from Microsoft over years and years as people continue to use it. So that's kind of where where this is going, but you know, this idea that they're they're expanding beyond just the home consoles kind of puts a a pin on uh in that because, you know, you have this this console at home and then you'll have this portable console to take with you, uh and then uh you'll have whatever else they they decide to cook up down the line. And it's it's just, you know, it's showing that, okay, Microsoft is ready for its next generation of consoles. Obviously, it's huge uh for the company, but Microsoft hasn't sold as well uh the Xbox hasn't sold as well as Sony's PlayStation, which is just blowing it out of the water or Nintendo Switch. So we'll have to see if they can turn that around, but I I think for Microsoft, as I said, the big deal is Game Pass. I mean, they spent $7.6 billion or something on ZeniMax Media. This is where they want people to go.

02:38 Speaker A

And I'm curious if you think this partnership is enough to dethrone Nvidia's, you know, position in the video game marketplace.

02:46 Dan Howley

I mean, Nvidia's huge on the PC side and there are more PC gamers than console gamers in the world just by virtue of the fact that there aren't consoles available everywhere or they're just too expensive. So I still think that Nvidia's going to have, you know, a huge lead in in that market. Microsoft is though putting its console games on PCs and its PC games on consoles, so it's moving back and forth between them so that it's not kind of segregated between the two markets. So it could benefit uh AMD in that respect. Um, you know, they already power the the Xbox now, they power uh the PlayStation right now with their custom chips. Nvidia's got Nintendo though with the switch. It sold gangbusters, it just the Switch 2 just sold out. So I mean, it's hard to see if if AMD's going to to throne them, but you know, when it comes to graphics powering games, it really is still Nvidia's market.

03:44 Speaker B

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