Squil, When was the rumored valhalla MB supposed to be coming online?
As I recall, Valhalla was supposed to bring a unified 65nm CPU/GPU chip which would reduce mother board size, cut the cooling system to one heatsink instead of two, reduce heat and hence cooling fan size/speed/noise, and reduce power consumption thereby further reducing size and cost of the power adapter. There would be additional cost savings from a reduction in assembly costs due to less complexity as well...
I don't know the potential cost savings of said valhalla, but I suspect it would be rather strong. This would more than offset the increased cost of including wireless as well as a larger hard drive.
A "slimmer" redesign with a slot load, built-in wifi, larger hard drive, and perhaps multiple colored boxes would be, in my opinion, the smartest move MS could make. That would carry them into the next gen with not much else to cost reduce except for die size on the cpu/gpu.








