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On the other hand, objective comments from those more informed than me say that AltiVec istruly superior to SSE, but if the long-term direction is to go towards Intel, that's pretty moot.

Apparently SSE2 is nearly as good as AltiVec/Velocity Engine/VMC now but the translation between the two isn't trivial so you'll still get a performance hit. The "solution" they'll probably use is just to throw even more processing power at it so you get reasonable performance doing the PowerPC emulation.