Both chipmakers are bullish about combining, but a key issue for them will be convincing skeptics they should join together in the first place.

Microsoft confirmed that it will begin offering a digital music and entertainment player, dubbed Zune, which will ship in late 2006.

"...Unless talks break down, a deal could be announced as early as Monday (Jul 24), the source said...Shares of ATI rallied on Friday on renewed speculation that a deal was close at hand..."