After months of dodgy hardware reports and multiple stories about the failure rate of our beloved Xbox 360 Microsoft have confirmed that Project Falcon is under way... the goal? A smaller, lighter, more cost effective chip set that will also resolve the serious hardware problems!

GamesIndustry.biz is reporting that Microsoft's new chipset, code-named "Falcon." is comprised of an IBM microprocessor and an AMD/ATI graphics chip that are both manufactured in a smaller 65-nanometer production process to increase the 360s tolerance to heat! The original chipset was manufactured in a 90-nanometer process.

Not only does the smaller chipset reduce the risk of overheating but also it will lower the production costs associated with the Xbox 360. Microsoft has had the 360 in the Market for some considerable time and has so far managed to maintain sales without issuing any formal price cut, although some retailers have recently been trimming prices in readiness of the Elite consoles arrival. The "Falcon" chipset could certainly be a step towards an official price reduction in the near future.

If we find out any thing... or if a price cut is announced at E3 we will of course let you all know as soon as possible!

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