Sony sells PS3's Cell to Toshiba

[eth3rton]

"So much for their earlier denial, eh? An anonymous Sony official has "confirmed" to Japan's Nikkei that they will sell their advanced computer chip operations to Toshiba in an effort to re-focus on core business. The official announcement is expected later today. The sale gives Toshiba the manufacturing responsibility for the much hyped Cell processor used in Sony's PS3. Sony, of course, will continue to invest in the Cell chip. Nikkei says the deal is worth some ¥100 billion (about $858 million) and should be completed by March."

Source via Enagadget.com (http://www.engadget.com/2007/10/18/sony-sells-cell-to-toshiba/)

[CaptStu]

Okay site pundits. What does this mean?

[Gorvi]

Okay site pundits. What does this mean?
http://www.samruby.com/Villains/DoctorDoom/DrDoomChap.gif

?

[Knite]

http://syn_knite.home.mindspring.com/evil/wile_e_doomed.jpg

[DingBat]

Sony's not doomed, but it IS a clear admission that their foray into processors was messed up. They must have lost their shirts.

[sonysyndicate]

Goodbye Blu-Ray

[KidCactus]

Goodbye Blu-Ray
How does this have anything to do with Blu-ray?

[Gorvi]

In all seriousness, if I remember correctly from earlier reports, this is just selling manufacturing rights, isn't it? They're essentially outsourcing cell production now, if I'm reading this right.

[Karmakin]

It's a good move for Sony, and it bodes well for better success for the PS4. Moving away from pushing specific unproven technology like some sort of ideology, and moving towards finding the best solutions for the best value for the customer is what they need to get back to.

Now all they need is to jettison Blu-Ray and they'll have a serious shot :). Actually that's too snarky. Blu-Ray drives probably will be cheap by that time. But if they jump to some other too expensive technology they'll hit the same wall.

[eth3rton]

In all seriousness, if I remember correctly from earlier reports, this is just selling manufacturing rights, isn't it? They're essentially outsourcing cell production now, if I'm reading this right.

I believe your right :

"The sale gives Toshiba the manufacturing responsibility for the much hyped Cell processor used in Sony's PS3. Sony, of course, will continue to invest in the Cell chip."

[Roc Ingersol]

Okay site pundits. What does this mean?Nothing really. The shareholders were nervous about losses, so they want to cut back on risky investments. So Sony offloaded some infrastructure/risk to Toshiba. (expensive equipment, buildings and staff)

This makes their bottom line look better in the short-run and in the long run they can still reap the benefits from Cell, should it become a commodity DSP. (They still want to use the cell for all their consoles, displays, video players, etc)

Sony's shareholders just want the bottom line to look better in the short-term, and they're willing to sign away some of the potential long-term profits on Cell to do so.

[roboninja]

http://www.samruby.com/Villains/DoctorDoom/DrDoomChap.gif

?

Uh-oh, I smell a lawsuit. TheFlyingOrc is very litigious :D

[Ancalagon]

Sony: "Rumble is old. Sixaxis is new and cool."
Later... "Remember what we said about Rumble? We lied. Its cool again. Go buy it, we wont give it to you for free."
Sony: "No! We would never sell our chip manufacturing plants! We are here forever!"
Later...

[Skampy]

This is a crazy announcement , Your pushing this new platform blu-ray , and your biggest competitor to blu-ray is Toshiba with HD-DVD. Now lets take our PS3 chip platform and outsource it to Toshiba. Hard to believe. Its not really a big deal but simply hard to believe.

[Limech]

Hum, I suspect the Toshiba plants are going to start to have "production issues" that will increase the Cell production costs, thus preventing Sony from succeeding with the PS3/blueray allowing Toshiba's HD-DVD format to win the format war! ;)

[Meglomaniac]

believe it or not this is a good move by sony. Or at least one that buys them more time and a possibly a way to avoid catching a case of the chapter 11s. Sony has previously sold off a good chunk of their insurance division for the same reason. The fact is they need money to keep going. Their latests forays have been costing them dearly. They have passed the point of no return and now it is sink or swim. By selling off chunks of their business they are ensuring they have the money necessary to stay afloat for a few more years with the hope that things will pan out for them.

The odd thing about this is that sony is selling to one of their biggest competitors. Toshiba competes with sony in almost every market with the exception of game consoles.

The scary thing, at least for them, is that if the PS3 and Bluray do fail, this may be the last generation for Sony.

[Evil_SPanKY]

Hum, I suspect the Toshiba plants are going to start to have "production issues" that will increase the Cell production costs, thus preventing Sony from succeeding with the PS3/blueray allowing Toshiba's HD-DVD format to win the format war! ;)

Now that would be poetic justice!

[Vandenh]

While it is probably a good idea to outsource production it is indeed a bit weird that mortal competitor Toshiba is picking it up.

[SPBTooL]

Does this give Toshiba the right to sell the cell to anyone they want or stop producing cell all together? I'm sure that there were thing in the deal that would prevent this. But I can't see why a Toshiba would do this when it is most likely for sale because it is loosing money for Sony. Are the facilities them selves enough to warrant the purchase?

Can you imagine if the lawyers left something out the gave Toshiba a loop whole to stop making the cell? Toshiba is one of sony's biggest competitors right?

[Ancalagon]

Does this give Toshiba the right to sell the cell to anyone they want or stop producing cell all together?

1. My guess is no, because Sony probably owns at least part of the copyright and/or patent for the design, thus Toshiba may own part of it, but not the whole. Also remember that Sony sold its chip manufacturing arm, not its IP.
2. Theoretically yes. Sony could request 5000 Cell chips, and Toshiba, being the legal owner of the manufacturing facility, would be well within their rights to tell Sony that they do not have the capacity to meet the demand. Of course, that would be bad for business. It is also likely that Sony has signed a mutual agreement with Toshiba guaranteeing business. Money in for toshiba, Cell CPUs in for Sony.

[Whimbrel]

I know the PS3 has been a pretty polarizing fiasco and has brought a lot of scorn to a company that for two generations made resonably priced consoles that pleased millions of customers. It is too bad that the PS3 worked out as well as current US foreign Policy, but I am glad that Sony has found a way to make at least some money from the thing.

[TheFlyingOrc]

Uh-oh, I smell a lawsuit. TheFlyingOrc is very litigious :D
Meh, it happens. And he used it well. Gorvi's on my "we a-ight" list.

Isn't Toshiba the major backer of HD-DVD? Maybe they'll put hidden viruses in the cells which will make the PS3s rays not Blue anymore, winning the format war in one fell swoop.

[Wraith]

I was thinking the same thing about Toshiba being a competitor (high-def discs, notebooks, TVs, portable music, etc.), but the Cell was developed by Sony, Toshiba, and IBM, so it makes sense that it went to one of the companies involved in its development. It looks like Toshiba was/is considering using Cell in some of their HDTVs.

http://en.wikipedia.org/wiki/Cell_processorIsn't Toshiba the major backer of HD-DVD? Maybe they'll put hidden viruses in the cells which will make the PS3s rays not Blue anymore, winning the format war in one fell swoop."Oh, my God. It's PS3. She's gone from suck to blow."

[Knite]

didn't Sony build a fab for the Cell? Is Toshiba getting the fab too? I can see this as a way for Toshiba to invest in more Fab space / ability (assuming cell production isn't taking 100% floor space), to allow them to make thier own chips easier (including the cell), and works for Sony, as they can concentrate more on thier finished products than on the internal components.

Make sense? In some ways, yes. Although I wonder if this is good for Sony long term or not.

[lockwoodx]

Meh, it happens. And he used it well. Gorvi's on my "we a-ight" list.

Isn't Toshiba the major backer of HD-DVD? Maybe they'll put hidden viruses in the cells which will make the PS3s rays not Blue anymore, winning the format war in one fell swoop.

More likely they will try and make hybrid players that support both formats for cheaper and win the war themselves.

[Sense Field]

This makes no sense....Sony and Toshiba are mortal enemies in the next gen dvd war. I don't like it one bit as an HD-DVD supporter.

[Kamalot]

More likely they will try and make hybrid players that support both formats for cheaper and win the war themselves.

Uh, you con't need Cell processors to play Bluray movies.

[TheFlyingOrc]

Uh, you con't need Cell processors to play Bluray movies.
You just need really blue rays. The Bluer, the better.

[Rafer]

Sounds to me like they're hedging their bets, like if the PS3 bombs really hard at least they sold off their Cell plant, on the other hand if the PS3 starts selling really well they'll wish they had held onto the plant. That's just a guess.

[Fonz]

Uhhh, all Sony has done is to give Toshiba the rights to manufacture the Cell Processor, nvidia does this with their chips all the time, in fact the RSX chip inside the PS3 is a nvidia lincesed product. Sony still owns the rights to CELL, on a odder note, Toshiba and Sony playing along is the wierder part of this story, considering Toshiba is the Founder/main backer of HD-DVD and Sony is for Blu-ray.

[Schnoogs]

What it means is that Sony's PS4 will be featuring symmetric processors ;)

[Kamalot]

Think Toshiba will buy my cell processor? I'm not using it. :rolleyes:

[Schnoogs]

Think Toshiba will buy my cell processor? I'm not using it. :rolleyes:

Every PS3 owner does have a spare core...maybe I can get $30 for it!

[Jack B]

A few comments:

1. It's a symptom of Sony's profitability issues with the PS3. This will help short term, but limits Sony's upside with the Cell.

2. Likely it increases Sony's future cost per Cell somewhat over their pre-PS3 projections, but it's probably better than the alternative.

3. It does nothing to limit Sony's ability to make games for the PS3. It could actually help by freeing up more cash short term.

Overall, it's an interesting development, that few would have expected two years ago at E3 2005. It could be a sign of more things to come or it could be some needed relief.

[Grifter]

The only thing this tells me for sure is that you can trust an internet rumor about Sony from "some dude on the forum" more than you can trust Sony themselves. I still believe the Cell is shit for traditional applications including gaming.

[Second Century]

By the time Cell gets its legs, Intel will have an easier-to-program, 64-bit, Core 2 Nona at retail. :rolleyes:

[Ancalagon]

I still believe the Cell is shit for traditional applications including gaming.

And you would be totally right. I hate it when stupid fanboys defend sony with lines like "Well design a better one then", or, "dude Sony is like a huge company, its the best there is. Its like 8 cores!", or "But it owns at F@H"

Sigh. Its not a stupid processor, but its in the wrong place entirely. No good as the CPU for any platform, PC or console.

[Venkman]

Sony sells PS3 cells by the sea shore.

[rennard]

As an aside, the Cell was jointly designed/developed by Sony, Toshiba and IBM (the literature referring to them as STI). Toshiba and IBM also have the rights to manufacture/use the technology for their own interests.

[Dracula-X]

Sony and Toshiba Cell production agreement is a 40/60 split venture (http://www.forbes.com/2007/10/18/sony-toshiba-update-markets-equity-cx_jc_1018markets04.html?partner=yahootix)

While the ownership of the asset would go to Toshiba, Sony and its gaming unit, Sony Computer Entertainment, would jointly participate in the production process as a minority shareholder of 40% in a new joint venture to be set up in April with Toshiba, which would take the remaining 60%.

[Serapth]

two words...

Exit Strategy.

[Gorvi]

Interesting (http://news.3yen.com/2007-10-19/the-other-shoe-falls-on-the-sonys-ps3-chip-sale/):

What everybody seemed to miss about this news—especially me—was that these “advanced” Cell processors were in fact the obsolete chip. As reghardware.co.uk sagely reports, Sony reaffirms IBM as 45nm Cell partner: the upcoming 45nm Cell chip for the PS3 will have, “a lower power and lower cost processor for its next-gen games console… Sony’s agreement to sell its [only it’s] Nagasaki processor production plant to Toshiba …”

That is, Sony dumped its outmoded Nagasaki fab plant on Toshiba, which now only can produce 65nm semiconductors and IBM will manufacture the new state-of-art 45nm Cell processor at its East Fishkill, New York facility for Sony’s latest game machines.

[Serapth]

Interesting (http://news.3yen.com/2007-10-19/the-other-shoe-falls-on-the-sonys-ps3-chip-sale/):

... for some reason I trust Forbes more. Maybe its the lack on anime ads on forbes website.

[Gorvi]

... for some reason I trust Forbes more. Maybe its the lack on anime ads on forbes website.
Is Forbes reporting that this isn't the case? Really, I'm asking, because this actually makes sense.

[Serapth]

Both companies said they would jointly advance the Cell chips to the next stage of technology: Toshiba was reported by Nikkei Business Daily as intending to roll out a 45-nanometer version of the Cell in two years and employinh the cutting-edge chips in personal computers and flat-panel televisions.

Yes, Forbes contradicts them. And, as I said, I trust Forbes more.

Also, to my knowledge, all Sony Cell chips were made in the same plant. A plant, coincidentially they paid a couple billion dollars manufacturing like 4 years ago.


EDIT: News announcement of the first plant. 1.6bil $. Ouch.

http://www.news.com/Sony-sinks-1.6-billion-into-Cell-plant/2100-1041_3-997596.html

"Cell will be the basic processor for building networks," Ken Kutaragi, Sony's executive deputy president, told a news conference. "In addition to expanding its use in new applications inside the Sony group, we want to take it outside the home and expand it to a variety of areas."

Sony, together with PlayStation maker and sister company Sony Computer Entertainment, will invest $1.6 billion in the new plant in the Nagasaki Prefecture.

[Wraith]

http://www.xbitlabs.com/news/other/display/20071018114439.html

Still sort of confused, as to whether both IBM and the Sony/Toshiba joint venture will be working on the new 45nm Cell.

[Serapth]

http://www.xbitlabs.com/news/other/display/20071018114439.html

Still sort of confused, as to whether both IBM and the Sony/Toshiba joint venture will be working on the new 45nm Cell.

IBM makes the cell inpedenantly for use in their server lines. That said, I don't think they really care too much about the chip as it seems to have been a bit of a flop for them.