GeeZee: AMD's proposed deal for the 'Xbox 720' makes sense for backwards compatibility with Xbox 360 games.
AMD/ATI has reportedly already won a deal to produce the GPU on Microsoft's Project Phoenix; otherwise the next Xbox console from Microsoft. Some have coined it the Xbox 720.
Fudzilla is reporting that AMD/ATI has been tasked to create the graphics processor for the next-generation Xbox, showing that Microsoft was very happy with the Xbox 360's Xenos GPU. The console is expected to hit in 2012.
But the AMD deal doesn't only make sense because Microsoft is happy with their current GPU, it also make sense for backwards compatibility with Xbox 360 games...