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Microsoft adds Xbox chipmaker

Chipmaker Focus Enhancement plans to announce Thursday that it has signed a contract to provide TV encoding chips for Microsoft's Xbox video game console. Campbell, Calif.-based Focus will join Conexant Systems as one of two suppliers of the chips, which convert PC code into signals suitable for display on a TV set.

Mike Kelly, vice president of marketing for Focus, said the company worked with Microsoft to design a lower-cost version of a critical but low-profile Xbox component. "When you go from a PC video format to a TV video format, it's a very complicated activity...but not something that's going to get a lot of attention," he said. Microsoft has made several moves this year to trim production costs for the heavily subsidized Xbox, including shifting production to China for units sold outside North America.