So the 65nm Xbox 360's are just around the corner, but are they already looking toward 45nm?

Chartered Semiconductor Manufacturing has announced that they are working on 45nm chips for a customer to be used in a videogame console.

They never specifically mention that the chips are for the 360, but since they already make the chips for the 360 it's safe to assume that the 360 will go 45nm.

It's not like they are making Cell processors for Sony.

The smaller the chips get, the cheaper and more efficient they become. This is good for Microsoft because they currently lose money on every 360 sold. Don't expect another price-drop based on this unless the 360 is selling poorly by the time it is ready.

Analysts expect the chips to be ready by late 2008 or early 2009. Just in time for Resident Evil 5!

PCAdvisor: Improved Xbox 360 processor planned