TeamXbox.com conducted an interview with Todd Holmdahl, Corporate Vice President of the Xbox Product Group at Microsoft, who asserts that the Teraflop advantage of the PS3 exists only on paper, whereas the 3-CPU-core hardware configuration of the Xbox 360 will be able to demonstrate greater real-life performance.

From Xbox 360 Interview: Todd Holmdahl - Xbox

Todd Holmdahl:

The PS3’s vaunted teraflop “advantage” is only an advantage on paper, because the PS3’s performance will be limited by its architecture. Real games are about 80% general purpose code and about 20% floating point code. Xbox 360 has three 3.2 GHz general purpose processors to Sony’s one, and it is these main cores, not special purpose SPEs, that are best suited for game code.
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Floating point performance is much more relevant on the GPU, where Xbox 360 has more floating point performance than PS3. Not only does the Xbox 360 GPU have greater raw shader power than the PS3 GPU (240 GFLOPS versus estimated 228.8 GFLOPS on PS3), it will also use more of its power.

Mr Holmdahl also addressed the highest resolution video output of the PS3 and the Xbox 360, respectively, saying that the tiny improvement of 1080p (highest PS3 resolution) over 720p or 1080i (highest Xbox 360 resolutions) is not worth the extreme jump in hardware cost, in particular as hardly any high-definition devices exist that can display this resolution.

Todd Holmdahl concluded the interview with TeamXbox.com, stating,

We also believe Sony’s PS3 teraflop calculations are wrong, and that their performance is actually closer to ours when we do the math. This gives us greater integer performance, greater memory bandwidth, and greater floating point performance on the GPU with much better utilization.

From our point of view, it appears that the greatest drawcard for Microsoft is its investment into Online Gaming via Xbox LIVE. The Sony Playstation has currently the greater marketshare, but we feel that performance issues is not what will win the console war. Even if the PS3 was twice as powerful in terms of real world game performance, this is not what will make one console great and the other one sub-par. It is the whole package that counts - games that are fun, concepts that take off (such as online gaming), and last but not least, the better marketing.

Related link:

Hypebox360.com - Poking fun at Microsoft’s marketing campaign and hype surrounding the release of Xbox 360