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Sony, Toshiba Forming Joint Venture

Sony Corp., Sony Computer Entertainment Inc. and Toshiba Corp. have decided to pool their resources into a joint venture that will take over manufacturing of the Cell processor and possibly other high-performance chips, they said Thursday.

Although they are still negotiating details of the venture, they expect it to begin operations on April 1 next year. Toshiba will own 60 percent of the shares with the remainder split between the two Sony companies. The three companies and IBM Corp. previously collaborated on development of the Cell chip, used in the PlayStation 3 games console, and chip's companion RSX graphics processor.

Sony also said it will sell its 300-millimeter chip production line in Nagasaki, Japan, to Toshiba. The production line is currently used to produce the Cell chip and after the sale will continue to do so under the control of the new joint venture.

The line currently produces the Cell using a 65-nanometer process technology but under Toshiba's ownership will be transitioned to a more advanced 45-nm process. The step up in production technology means the Cell will be physically smaller and consume less power. It should also bring down the production cost of each chip.

Sony is trying to reduce hardware costs of components used in the PlayStation 3 so the deal should further that aim. It could also hasten the adoption of the Cell processor in other products. Toshiba and Sony have a long-stated aim of embedding the chip in consumer electronics products.

At this month's Ceatec exhibition in Japan Toshiba showed off a new processor based on the Cell. The SpursEngine multimedia coprocessor is based on the Cell Broadband Engine processor core and was demonstrated embedded inside a laptop PC assisting the main processor in carrying out some heavy-duty graphics processing.

Sony has also agreed to transfer its assets in another joint venture, Oita TS Semiconductor Corp., to Toshiba when the current deal expires in March 2008. The venture was established in 1999 to produce chips for the PlayStation 2 console.

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