Found this over at GameDaily.
A chip is an extremely tiny bit of data that can be looped to form a tone. Basic chips include sine waves, square waves, sawtooth waves, and triangle waves. Composing a piece in chip tunes results in a file that is remarkably small in file size, which was beneficial to early video games, because at that point there was no extra room for data.
No! The chip in chiptune refers to the actual sound chip in the computer. You know, the electronic circuit that brings the noise. There is such a thing as a “chip sample” though. If you replace “chip” with “chip sample” you get a somewhat correct, but still clearly misinformed piece of text. This is what happens when amateur journalists don’t bother getting to know the subject they’re writing about. I don’t have too much trust in that Chris either though…
Let’s go through this once and for all.
On the left side you have a sound chip. (In fact two of them) Early video game consoles did not have any hardware support for sample playback, but relied on synthesis for all its sound generation. These chips is where that happened.
On the right side you have a chip sample, in which is a loopable sound sample, (usually) sampled from a console with a sound chip!
Not so hard to understand, eh, GameDaily?
But hey, at least they’re linking to my Gameboy music how-to! (Which is how I found that page, through referrer logging)