Microsoft Looks Within to Design and Test Chips

MOUNTAIN VIEW, Calif., Oct. 16 — For more than two decades, Microsoft’s software and Intel’s processors were so wedded that the pairing came to be known as Wintel. But as that computing era wanes, Microsoft is turning to a new source of chip design: its own labs.

The design effort will initially be split between research labs at the company’s headquarters in Redmond, Wash., and its Silicon Valley campus here. Tentatively named the Computer Architecture Group, the project underscores sweeping changes in the industry.
I tihnk this is an exciting move by Microsoft. With Microsoft's move into the consumer electronics market (Xbox, Zune, etc), it makes sense for Microsoft to design its own silicon based on its own technologies rather than licencsing others, which commonly happens in the comsumer electronics sector.

Now if only they would open a R&D lab in Australia