Larrabee as a consumer graphics card is dead, according to Intel itself.

We should know more about the Larrabee situation next year, as Intel is already planning on an announcement at some point in 2010. Our best guess is that Intel will announce the next Larrabee chip at that time, with a product release in 2011 or 2012. Much of this will depend on what the hardware problem was and what process node Intel wants to use. If Intel just needs the ability to pack more cores on to a Larrabee chip then 2011 is a reasonable target, otherwise if there’s a more fundamental issue then 2012 is more likely. This lines up with the process nodes for those years: if they go for 2011 they hit the 2nd year of their 32nm process, otherwise if they launched in 2012 they would be able to launch it as one of the first products on the 22nm process.

For that matter, Since the Larrabee project was not killed, it’s a safe assumption that any future Larrabee chips are going to be based on the same architectural design. The vibe from Intel is that the problem is Larrabee Prime and not the Larrabee architecture itself. The idea of an x86 many-cores GPU is still alive and well.

On the recent media attention: we're not cancelled - far from it.

I don't care how Fermi will look in two years,

As if AMD will just be stagnant and do nothing in that same period.

The only thing plugging the dam has been some excellent marketing and thinly veiled bribery.