Japan's Sony Corp and Germany's Qimonda AG said yesterday they have agreed to form a joint venture to design high-performance DRAM memory chips for consumer and graphic applications.
The 50-50 joint venture, to be called Qreatic Design, will be based in Tokyo and is expected to start operations by the end of this year, the companies said in a joint statement.
The joint venture is expected to start with up to 30 "specialists" from Sony and Qimonda, the companies said.
Financial terms of the joint venture agreement, subject to regulatory approvals and other closing conditions, were not disclosed.
Their partnership highlights the growing competitiveness in making DRAM, or dynamic random access memory, chips, used in personal computers.
Sony currently buys the chips from suppliers including Elpida Memory Inc. Munich-based Qimonda is an Infineon Technologies AG unit. By partnering with Sony, Qimonda secures orders from the world's second-largest maker of consumer electronics after Matsushita Electric Industrial Co.
The capital-intensive sector has forced many of the global chip makers to seek joint ventures or form strategic alliances to share technology, design and production costs.
In 2004 Qimonda rival Hynix Semiconductor Inc of South Korea formed a joint venture with STMicroelectronics NV of Geneva.
Sony, which lost ¥10 billion from its semiconductor operations last fiscal year, is reorganizing the division. Last month, the company said it's considering various options after the Nikkei newspaper reported that Sony may sell some production lines, including those that make the Cell processors that run the PlayStation 3 game consoles, to Toshiba Corp. The division posted an operating profit in the quarter ended June 30.
In February, Sony said it will scale back investments on chips and may give up manufacturing future versions of the Cell by hiring other companies to make the semiconductors.
The company may be able to afford further investments to make TVs and digital cameras after the initial public offering of Sony's financial unit raises ¥320 billion, Japan's biggest IPO this year.
Samsung Electronics Co was the largest producer of non-computer DRAMs last year, followed by Elpida, Qimonda, Micron Technology Inc and Hynix Semiconductor, researcher Gartner Dataquest said.
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