IBM is picking up deals for its PowerPC 64-bit chip set, intensifying its rivalry with Intel's Itanium.

Last week Microsoft chose the PowerPC chip for its Xbox 2. The software giant is also using the the 64-bit chip extensively in its own enterprise servers alongside Intel processors, and possibly AMD in future, for 32-bit applications.

The Microsoft agreement follows original equipment manufacturer deals for the Apple Mac, Nintendo Gamecube and Sony PlayStation.

David Valentine, IBM's Linux EMEA sales manager, said: "The PowerPC is designed for very high floating point applications and is suited to rendering for animation, making it ideal for gaming. The agreements give us economies of scale.

The same features are suited to specific enterprise applications. "Scientific and technical customers requiring high memory bandwidth and low latency discovered they were reaching the performance edges of 64-bit Intel [Itanium 2]," claimed Valentine.

"The problem was overcome by using PowerPC-based clusters."

As part of its recent JS20 BladeCenter announcement, IBM offered the choice of a 64-bit PowerPC-based blade at the same price as one using a 32-bit Intel Xeon processor ($2,699).

IBM's BladeCenter can be connected to any of its i-, p- or xSeries ranges and allows a mix of processors. An AMD Opteron (32-/64-bit) blade is likely to be available next year.