Sony and NEC Conclude MOU Aiming to Establish Joint Venture in Optical Disc Drive Business

Tokyo, Japan, Nov. 17, 2005 - (JCN Newswire) - Sony Corporation (TSE: 6758; NYSE: SNE) and NEC Corporation (TSE: 6701; NASDAQ: NIPNY) have concluded a Memorandum of Understanding (MOU) aiming to establish a Joint Venture company in the optical disc drive business. Sony and NEC will work together from now to reach agreement on a final contract. The new company will aspire to become the leading company in the optical disc drive sector.

Sony will hold a 55% stake in the new company while NEC's stake will be 45%. Sony and NEC will make preparations to transfer their respective optical disc drive operations to the Joint Venture, targeting a business start on April 1, 2006. The Joint Venture will focus on the planning, design, manufacturing and marketing to manufacturers of optical disc drives (DVD and CD drives) for integration into products such as PCs. The company will operate on a global basis.

The new company will pool the best in optical disc drive technology (e.g. NEC's strengths in LSIs and Sony's expertise in optical pickups) to deliver high quality and reliable products to consumer electronics and PC makers on a timely basis.

Sony's President and Electronics CEO, Ryoji Chubachi commented, "Optical disc drives are key components for a broad range of devices and we are strategically focusing our development resources in this sector. By teaming with NEC which has excellent technology in areas such as DVD drives, I believe we can work effectively to enhance our product lineup and quality on a global scale."

NEC's President Akinobu Kanasugi commented, "The market for high value-added drives to be integrated into PCs and consumer electronics products is rapidly expanding. I believe we have made the best choice in partnering with Sony with whom we can build a total value chain covering procurement of key components, production and marketing. This will allow us to realize the aim of becoming the top vendor in this sector."

Outline of JV

Capital: Amount to be determined
(Sony will have a 55% stake, NEC will have a 45% stake)
Operational Start: Planned for April 1, 2006
Scale of Business: In FY04, the optical disc drive businesses of both companies
combined generated about 220 billion yen.
Executives: Sony will designate the President while NEC will designate
the Vice President of the company.

About NEC Corporation

NEC Corporation (TSE: 6701)(NASDAQ: NIPNY)(UK: NEC.IL) is one of the world's leading providers of Internet, broadband network, and enterprise business solutions dedicated to meeting the specialized needs of its diverse and global base of customers. Ranked as one of the world's top patent-producing companies, NEC delivers tailored solutions in the key fields of computers, networking, and electron devices by integrating its technical strengths in IT and networks and by providing advanced semiconductor solutions through NEC Electronics Corporation. The NEC Group employs more than 140,000 people worldwide and had net sales of 4,855 billion yen (approx. $45.4 billion) in the fiscal year that ended in March 2005. For additional information, please visit the NEC website at:

For further information, please visit the NEC Corporation home page at:

About Sony

Sony Corporation is a leading manufacturer of audio, video, game, communications, key device and information technology products for the consumer and professional markets. With its music, pictures, computer entertainment and on-line businesses, Sony is uniquely positioned to be the leading personal broadband entertainment company in the world. Sony recorded consolidated annual sales of approximately $72 billion for the fiscal year ended March 31, 2004.

For further information, please visit the Sony home page at:

Sony Corporate Communications
Tel: +81-3-5448-2200

NEC Public Relations Division
Tel: +31-3-3798-6511

All Topics