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As Intel's (NASDAQ:INTC) battle with Nvidia (NASDAQ:NVDA) heats up, the chip giant is having trouble keeping its powder dry. Intel rushed a new netbook processor to market ahead of schedule in response to the threat from Nvidia's Ion platform, which also targets the netbook market. The new Atom N280 processor is paired with a chipset that allows users to watch high-definition content on netbooks while using less power. Intel originally developed the Atom N270 with the 945GSE chipset for netbooks to run basic applications, which did not include hardware-based HD video decoders. The Ion platform allows netbooks to display 1080p HD content, which is superior even to Intel's new Atom chip.

A revolution in parallel computing has put Intel on the defensive. Its lethargic legacy CPU serial computing empire is being threatened by faster GPU parallel technology which needs less power. Nvidia's confident leader, CEO Jen-Hsun Huang, is often denigrated the way the head of any rebellion would be. The turf war has escalated to the point where rumors make it difficult to see who is winning the numerous battles. The battlefronts most subject to rumors include smartphones, game consoles and partnerships with Apple (NASDAQ:AAPL).

According to an analyst at Broadpoint American Technology Research, an upcoming Microsoft smartphone will use Nvidia's Tegra chip. Microsoft (NASDAQ:MSFT) has denied the rumor. Apple will eventually use the Arm-based chip in the iPhone, the San Francisco-based research firm is speculating. Nvidia will also power new mobile devices made by HTC, says Broadpoint. Tegra puts an Arm-based processor, a GeForce graphics core and other components onto a single chip. An older rumor, reported by Tom's Hardware, suggests that when Apple's Mac Mini is updated it will use the Ion platform. The Inquirer is the source of the most recent rumors. Intel will design Sony's Playstation 4 GPU, reports Charlies Demerjian. Advanced Micro Devices's (NYSE:AMD) ATI unit will likely develop GPUs for the Xbox3 and Wii2, suggests the Inquirer. That would mean Nvidia is being left out.

The rumor which requires the most imagination is Nvidia's plan to release an unsanctioned x86 processor. The Inquirer also made that allegation recently. Shortly after AMD announced its plan to buy Nvidia's chief competitor, ATI, in the summer of 2006, speculation was rife that Nvidia was seeking an x86 license. A year after AMD's announcement, Intel officially revealed its plan to develop its first graphics card, named Larrabee. The plan moving forward for Intel and AMD is to couple their respective graphics cards with the x86 CPU to compete in the new parallel computing environment. It seems logical. And it seemingly leaves Nvidia out in the cold.

At the present time, however, Nvidia's CEO does not plan to follow that roadmap. Huang does not believe that the x86 architecture and license is the hurdle that many analysts suggest it is. He is promoting "visual computing" and is concentrating on next-generation GPUs. Time will tell who has the better idea.

It's possible AMD may have shot itself in the foot when it bought ATI. The huge, multi-billion dollar pricetag has been a debilitating burden. Premium GPUs require very large capital expenditures. As a result of its financially compromised position, AMD has been forced to cede the high-end GPU segment to Nvidia. To add insult to AMDs' injury, Nvidia appears to have bright prospects even without the x86 license. Apple has bought into the Ion platform - at Intel's expense. According to Steve Jobs, the Ion solution is five times faster than the Intel architecture that's been replaced in Apple's laptops.

Nvidia has pioneered a new wave of desktop high performance computers (HPC) which use a hybrid CPU-GPU. The lack of an x86 license has prompted Nvidia to lead the development of the nascent market for general purpose graphics processing units, known as the GPGPU. The emerging personal supercomputer platform has had a huge impact on how engineers and scientists tackle complex design and simulation projects. Nvidia's Andy Keane, general manager for supercomputing, is pushing its new Tesla processor as the heart of this new paradigm. Intel has not benefited from x86 as it seeks to promote the Atom chip as a smartphone solution. The ARM core is the predominate smartphone processor because it uses much less power than x86 chips.

Source: Rumors Cloud the Intel - Nvidia Turf War