I think there are 2 kinds of PhysX, a hardware and a software solution. You can buy hardware PPU cards for PCs that calculate physics. You can also have the CPU do physics calculations in software.
Ageia was hoping to sell the hardware parts, but with today's CPUs and GPUs, they can handle it just as well. Havok is another software physics solution that many games use. Intel recently bought them. So, you know physics is here to stay.
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