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Sony’s Playstation 2 and I.B.M. will use Butterfly.net for grid computing for gamers reports the Washington Post . They plan to unveil it at the annual Game Developer’s Conference in San Jose next week.

The Butterfly Grid will use IBM’s Dual Xeon Blade Servers running Linux. The concept cuts costs for game developers and allows on-line games to involve hundreds of thousands of simulateous players.

When the grid determines there are too many players connected to a particular server, it automatically reconfigures the underutilized blades to support the most popular game-play and seamlessly transfers players to those blades.

“This expands our developer community and user base exponentially,” said Butterfly.net chief executive David Levine. “Now we’re just part of the whole Sony economy, and they’ve shipped 50 million PS2s.”

“We’ve enjoyed very rapid progress and outstanding performance while developing and testing VibeForce on the Butterfly Grid,” said Curt Benefield, Chief Executive Officer of Sherman3D, a video game developer with offices in Malaysia and the United States. “The Grid has allowed us to build the bulk of our game logic, our motion models and our artificial intelligence systems with familiar tools and standard interfaces. Our engineers can get close to the metal on the client, the servers and over the network to bring the action-backed, richly-rewarding console experience online.”

The Butterfly Grid is hosted by IBM and powered by IBM Dual Xeon Blade Servers running Linux, IBM’s WebSphere and DB2 software. They are working with the Global Grid Forum to ensure that video games are developed according to publicly available specifications.

About 50 million Playstation 2s will be in homes by the end of the year and 17% of all computer-owning households do some online gaming. VibeForce plans to charge $9 a month.

Unlike Microsoft’s Xbox Live, in which Microsoft runs the central hub for all online games (near Redmond), Sony does not serve as the gatekeeper for the PlayStation 2 Grid. Instead, individual game developers register with Butterfly, and receive a software development kit. To reach the grid, the model depends on service providers, who use Butterfly’s XML-based Game Configuration Specification to extend the grid out to the edge of the network.

Butterfly CEO David Levine believes that service providers will evolve to become like cable MSOs, which offer packages of games to subscribers much like the MSOs offer premium cable channels.

Video games are already big business. They racked up $9.4 billion in revenues last year, outgunning Hollywood’s box office take of $8.1 billion by a cool billion dollars.

Dailywireless stories on game grids include Grid Becomes Self-Aware, Multi-Player Frontier, The Pittock Internet Exchange, The West Coast Grid and Korean Gaming.

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