After HD DVD Drop, Toshiba Spends $835M to Back PS3
February 23, 2008 12:46 PM
comment(s) - last by
The 90nm Cell/B.E. package as found in the PlayStation 3, now to be manufactured by Toshiba.
Sony gives Toshiba something in return for its troubles -- Japanese Cell chip plants for $835M
A new twist has emerged with the death of HD DVD. After Warner, Best Buy, Walmart and Netflix jumped on the Blu bandwagon
, the fate of HD DVD was already sealed.
Despite the grim news, the principal HD DVD developer, Toshiba Corporation,
refused to initially comment on its plans for its HD DVD
. However, as many analysts predicted, Toshiba came out last week and
officially surrendered to Blu-ray
Many saw Toshiba's willingness to give up on HD DVD as a logical business decision and perhaps an admission of Blu-ray's superiority. However, there might be a little more to the story.
reports that on Wednesday Toshiba and Sony Corporation, one of Blu-ray's principal developers,
agreed to a major business deal
, reached just after Toshiba made its final HD DVD decision.
Sony agreed to sell it microchip processing facilities in western Japan for approximately $835M USD. These facilities currently produce Cell processors and RSX graphic chips. Toshiba will enter the joint venture with Sony on April 1, 2008.
Toshiba, IBM and Sony were the principal developers of the Cell microprocessor, but Toshiba previously showed little interest in using the chip for any of its own projects. Sony touts the Cell broadband engine in its Playstation 3 consoles; IBM uses the Cell processor in high performance computing clusters. Toshiba has vowed to now use the Cell in its upcoming products.
While Toshiba and Sony
entered into talks back in October 2007
and reached a tentative agreement to sell the cell facilities, the two companies continued to haggle about the price. Sony's concession of what is considered a favorable price for Toshiba will likely strike many following Toshiba's drop as HD DVD as more than a coincidence, and perhaps a sign of an informal agreement.
The other interesting aspect of the move is that it indicates a clear shift by Toshiba to back the PS3. The PS3, which last month
outsold Microsoft's Xbox 360
, previously had few ties to the company; while Microsoft's number one ally in hardware manufacturing has always been Toshiba. Toshiba manufacturers several components for the Xbox 360, including the HD DVD add-on, and the Microsoft Zune MP3 players.
Toshiba's flip-flop may have been in the cards for a while.
Microsoft showed little remose
as HD DVD took second place to Blu-ray; a move Toshiba must have recognized from its American ally. Now the solidified PS3 venture between Sony and Toshiba indicates that Toshiba now has switched to backing the PS3 almost exclusively,
another victory for Sony
This article is over a month old, voting and posting comments is disabled
RE: what does this change exactly
2/23/2008 8:24:48 PM
And what rights does Toshiba have when it comes to selling on manufactured Cell chips? Are they restricted to selling to the companies Sony tell them they can sell to or do they have free reign and hence sell it to the likes of Microsoft.
Not sure if its just due to the internet crowd becoming more aware of such business politics but there seems to be a lot of news being over-glamourised.
Hands up how many people knew that Nintendo made money from UK PS2 sold in the chanel?
And where's the cufuffle over IBM, Intel, nVidia and ATI/AMD? AMD makes the GPU for both the Wii and Xbox360. nVidia and Intel both made parts for the original Xbox and "jumped ship" to MS's competitors this generation - nVidia makes the PS3's RSX and Intel launched the Core Duo in Macs. In the same light IBM went from Apple to MS as its processors went from Macs to the Xbox360. IBM not only makes the Wii and Xbox360 processors but is a partner of Sony in the Cell's creation.
Toshiba's purchase was simple business, the biggest selling HiDef player so far is the PS3. If both Sony and Toshiba continued the "HD-War" both companies would lose money selling their products at reduced prices. By buying the plants Toshiba has a contract with Sony that lasts at least as long as the PS3, then there's all the other products the Cell was meant to be a part of and each processor will be sold at a profit. Toshiba has bought itself a steady cashflow in a less volatile and risky market.
"When an individual makes a copy of a song for himself, I suppose we can say he stole a song." -- Sony BMG attorney Jennifer Pariser
Microsoft Calm About HD DVD Defeat
February 19, 2008, 4:51 AM
Update: Toshiba Comments on HD DVD, Decisions Imminent
February 18, 2008, 12:14 AM
Toshiba Officially Surrenders in HD Format War
February 19, 2008, 7:46 AM
PS3 Outsells Xbox 360, Bested Only by Wii in January Sales
February 15, 2008, 9:26 AM
Netflix Picks Blu-ray Disc as Exclusive HD Format
February 11, 2008, 7:21 AM
New Photos Show “Assembled” iPhone 6, Protruding Camera Ring
August 20, 2014, 2:32 PM
ZTE Nubia 5S mini LTE 4.7" Smartphone Headed to U.S. for $280 Unlocked
August 20, 2014, 10:37 AM
AT&T Will Also Receive the HTC One (M8) for Windows
August 19, 2014, 9:27 PM
Sharp's "Edge-to-Edge" AQUOS Crystal Smartphone Coming to Sprint for $239 Off-Contract
August 19, 2014, 7:31 PM
After 34 Years With Microsoft, Steve Ballmer Parts Way to Focus on LA Clippers
August 19, 2014, 4:17 PM
HTC One (M8) for Windows Officially Announced for Verizon Wireless
August 19, 2014, 12:15 PM
Most Popular Articles
Lumia 830 Gets Major Upgrades Including New 20.1 Megapixel Toshiba Sensor
August 15, 2014, 6:00 PM
Windows Phone, BlackBerry Smartphone Market Share Falls to 2.5%, 0.5% Respectively
August 15, 2014, 9:44 AM
GM Concedes That the Cadillac ELR Doesn’t Really Compete with the Tesla Model S
August 15, 2014, 5:42 PM
Cell Phone Thief Calls 911 After Her Victim Chases Her and Her Male Cohort
August 14, 2014, 12:11 PM
Smarter Wired, Wireless Chargers Set to Shake Up Mobile Industry
August 14, 2014, 6:39 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information