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Well I guess they could go smaller if they have both RSX and Cell on a 32nm process. I wonder if they are limited by the memory architecture, they would probably have to switch to 4x 1Gbit 32bit XDR ram if they wanted to combine it. I think Microsoft may have the advantage of only having to deal with one memory bank instead of two so ultimately the Xbox 360 may be smaller but only if Microsoft invests the money into it.