Microsoft To License Graphics Technology From Nvidia for Xbox 360's Backwards Compatibility

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Microsoft has signed a deal to license Nvidia's graphics technology in order 
to have the Xbox 360 backwards compatible--finally putting to rest the 
question that lingered behind current-gen Xbox users.
The next-gen 360 uses an ATI chipset, whereas the current Xbox uses an 
Nvidia chipset. Since the two companies are rivals in the GPU market, many 
analysts were skeptical that Microsoft would deliver. The company made a 
cryptic announcement at E3, saying the "best-selling" Xbox titles would work 
on the Xbox 360.

Microsoft since then has become more optimistic about backwards 
compatibility, with Microsoft Xbox PR Manager Michael Wolf saying, "our goal 
is to make all Xbox games play on Xbox 360, and at launch we'll have a 
selection of the top selling that will be tested and confirmed to work."