According to Cens.com, the first 65nm GPU chip equipped Xbox 360s -- codenamed Jasper, the successor to current Falcon 360s, which incorporate a 65nm CPU but use a larger GPU -- will start showing up in by August of this year. IBM will reportedly manufacture and test the CPU chips, while Taiwan Semiconductor Manufacturing Co. (TSMC) has reportedly been contracted to manufacture and the graphics chips, which will in turn be tested and packaged by Advanced Semiconductor Engineering Inc. (ASE). Nanya will be responsible for supplying flip-chip packaging substrates (don't ask us). Furthermore, CENS reports that industry watchers are betting on TSMC to win contracts to manufacture chips for Japser's successor, Valhalla, which will combine both the CPU and graphics chips into one super chip.
The upshot of all this is that new chips should be arriving this August, making for cooler, quieter 360s everywhere. that's something we can all enjoy, right? Oh, and no, there was no mention of Microsoft cramming Blu-Ray drives into either the Jasper or Valhalla.
[Via Joystiq]
Update: Clarified differences between Falcon and Jasper units
If you're in the market for a new Xbox 360, you'll want to make sure you know how to spot the new 
If you've been waiting for the 
Microsoft has been planning on reducing the chip size of the 360's CPU since inception, but it looks like it's going to be a while longer before that actually happens. Digitimes reports that the large 90nm chip that's currently in the 360 will be shrunk down to a nicer 65nm, but not until mid 2007 because of a delay. The benefits of shrinking a CPU are not only cost reduction, but less power consumption, and less heat is generated. When a gaming console's innards get smaller and cost less, that can only mean good things for consumers and a possible price reduction may be in the distant future. And since the new smaller chip will need less power maybe we can finally reduce the size of that huge power brick.
