Intel lost the Sony Playstation business to AMD

The problem with choosing Nvidia is that they can't make an x86 processor with an integrated GPU. If you're looking to maintain backward compatibility with the Playstation 5, you're probably going to want to stick with an x86 chip. AMD has the rights to make x86 chips and it has the graphics chips to integrate.

Nvidia has graphics chips, but it doesn't have the CPUs. Yes, Nvidia can make ARM CPUs, but they haven't been putting out amazing custom cores.

AMD can simply repackage some Zen X cores with RDNA X GPU and with a little work have something Sony can use. Nvidia would need to either grab off-the-shelf ARM Cortex cores (like most of their ARM CPUs use) or Sony would need to bet that Nvidia could and would give them leading-edge performance on custom designed cores. But would Nvidia come in at a price that Sony would pay? Probably not. AMD's costs are probably a lot lower since they're going to be doing all that CPU work anyway for the rest of their business.

For Nintendo, the calculus is a bit different. Nintendo is fine with off-the-shelf cores that are less powerful than smartphones and they're already on ARM so there's no backward incompatibility there. But for Sony whose business is different, it'd be a huge gamble.

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I think changing from AMD GPUs to Nvidia GPUs by itself has a good chance of breaking backwards compatibility with how low level and custom Sony's GPU API apparently is, so the CPU core architecture would just be a secondary concern.

I was not saying Sony should switch to Nvidia, just pointing out that it is objectively incorrect to say that AMD is the only option for consoles when the most popular console today does not rely on AMD.

I also fully believe Intel could scale up an integrated Battlemage to meet Sony's needs, but is it worth the break in compatibility? Is it worth the added risk when Intel's 13th and 14th gen CPUs have had such publicly documented stability issues? I believe the answer to both questions is "probably not."

No one appears to have mentioned the important meta game going on: Intel bidding as a credible alternative supplier.

For Intel, by bidding they get to undercut AMD's profits.

For Sony, they get a credible alternative which they can pretend would be a viable choice. Thus forcing a slightly better deal from AMD.

We saw similar articles related to the Switch 2. That time it was AMD acting as spoiler to Nvidia. Nvidia reportedly got the contract. That time too we got news articles lamenting this loss for AMD.

As a gamedev I have a different perspective: Sony and Nintendo would be fools to give up backwards compatibility just for savings on chips.

Switching vendors does not just invalidate old games compatibility, it also requires retooling for their internal libraries. Console games, outside small or open source engines, use proprietary graphics api. Those apis are tied to the hardware. With this coming generation from Nintendo, and the "current gen" from Sony and Xbox they've been able to mostly reuse much of their software investment. I'd case more but this is obviously nda, other devs should be able to confirm.

Thus I don't think AMD for switch2 or Intel for ps6 was ever a credible path. Their bids existed to keep the existing vendor from getting overly greedy and ruining the parade for everyone. This is important, famously the original Xbox got hamstrung in the market by Nvidia's greed and refusal to lower prices as costs went down.