NVIDIA's senior vice president of content and technology Tony Tamasi has said that he believes his company passed on putting its hardware in Sony's PlayStation 4 console because of the amount of opportunity cost. Speaking to GameSpot Tamasi said,
I'm sure there was a negotiation that went on and we came to the conclusion that we didn't want to do the business at the price those guys were willing to pay. Having been through the original Xbox and PS3, we understand the economics of the development and the trade-offs.
Instead, Sony's PlayStation 4, which was announced in February, runs on AMD's 64-bit 8-core x86 Jaguar CPU with a Radeon GPU. AMD has also been heavily rumoured to be building the chips that will go into Microsoft's next generation Xbox. AMD have struggled lately with its losses increased in the fourth quarter. They will likely be hoping that the deals with Sony and possibly Microsoft will help them get back into the positive.
If we say, did a console, what other piece of our business would we put on hold to chase after that? In the end, you only have so many engineers and so much capability, and if you're going to go off and do chips for Sony or Microsoft, then that's probably a chip that you're not doing for some other portion of your business. And at least in the case of Sony and NVIDIA, in terms of PS4, AMD has the business and NVIDIA doesn't. We'll see how that plays out from a business perspective I guess. It's clearly not a technology thing.