Sony agrees to sell PS3 chip lines to Toshiba
Sony has officially announced a deal where they will sell Cell production facilities to Toshiba. The Cell chip, which was developed in part by IBM and Toshiba, is regarded as the main reason why PS3 is so powerful. Production facilities for the chip will be sold to Toshiba in a deal that's worth an estimated 130 billion yen ($1.1 billion US).
Due to the sluggish sales of the console, Sony will need to reduce losses from the games division to something more acceptable. Osamu Hirose, analyst at Tokai Tokyo Research Center, notes that this is a good step in the right direction for the beleaguered electronics company. "In this context, the spin-off of the chip business, which requires continued and heavy investment, is positive for Sony," he said.
Sony will also sell RSX (the graphics chip of the PS3) manufacture to Toshiba. Sony stock rose 0.6 percent after the announcement.
