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[DT] Toshiba Spends $835M to Back PS3

post #1 of 19
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Quote:
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 principle 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. Reuters reports that on Wednesday Toshiba and Sony Corporation, one of Blu-ray's principle 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 principle 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.
DailyTech
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post #2 of 19
wow.. So I'm guessing if u can beat 'em , join 'em.
    
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post #3 of 19
"Sony gives Toshiba something for its troubles".

They are implying some reward for dropping HD-DVD when in truth this deal for the cell plants was made in October.
    
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post #4 of 19
very nice find, Mike.... you always seem to find the inside track. Smart move by both companies imho.
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post #5 of 19
But what can Toshiba do for the PS3? I realize they manufactured the HD-DVD drive for the Xbox 360, but the PS3 already has a Blu-Ray drive.

I don't understand why the article was titled "Toshiba backs PS3!!!" When clearly it seems more like it should be "Toshiba befriends Sony, and makes logical plans for the cell cpu!"
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post #6 of 19
Thread Starter 
Quote:
Originally Posted by rottenotto View Post
very nice find, Mike.... you always seem to find the inside track. Smart move by both companies imho.


Quote:
Originally Posted by HowLowCanYaGo View Post
But what can Toshiba do for the PS3? I realize they manufactured the HD-DVD drive for the Xbox 360, but the PS3 already has a Blu-Ray drive.

I don't understand why the article was titled "Toshiba backs PS3!!!" When clearly it seems more like it should be "Toshiba befriends Sony, and makes logical plans for the cell cpu!"
Toshiba helped develop the Cell, and I'm not sure why they dont mention it in the article, but Toshiba has also implemented the Cell in some HDTVs.
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post #7 of 19
Maybe Toshiba is giving some money to make more money?
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post #8 of 19
Quote:
Originally Posted by redsox83381 View Post
"Sony gives Toshiba something for its troubles".

They are implying some reward for dropping HD-DVD when in truth this deal for the cell plants was made in October.
I think you are referring to the sale of the Hong Kong production plant?
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post #9 of 19
WTH...I'm not trying to start anything, but what use would a cell be in a TV?!
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post #10 of 19
Quote:
Originally Posted by RickJS View Post
WTH...I'm not trying to start anything, but what use would a cell be in a TV?!
That's exactly what I was wondering
I mean the cell is supposed to be a lot better then a Q6600... why would a TV need that kind of power?
    
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