Could Sony have the ground for a major industrial Lawsuit vs Microsoft and IBM?

[Elandyll]

http://www.engadget.com/2009/01/01/b...crosoft-borro/

Book details how Sony paid for Xbox 360 dev, let Microsoft borrow its car, acted like a doormat
by Joseph L. Flatley, posted Jan 1st 2009 at 9:02AM

This year we've seen the PS3's Cell processor pitch in and help break the petaflop barrier, exploit a major security hole in SSL encryption and enable adolescent hijinks on PlayStation Home. Obviously, this is one serious piece of kit. According to The Race For A New Game Machine, written by two of the folks responsible for designing the thing, the Cell (a partnership between Toshiba, Sony and IBM) was the product of a deal that opened the door to IBM selling key parts of the chip to Microsoft before they had even finished building it -- even though this was clearly not part of the plan. Essentially, Sony's R&D money was spent creating a component for their rival, helping the Xbox 360 make its launch date of November 2005, while the PlayStation 3 was pushed back a full year. It seems somewhat fitting that the troubled game system should have such dysfunctional origins, no?

I find those details sick (if true), but not quite out of character for the love-hate relationship that have Microsoft and IBM.

[androvsky]

Originally Posted by Elandyll

http://www.engadget.com/2009/01/01/b...crosoft-borro/



I find those details sick (if true), but not quite out of character for the love-hate relationship that have Microsoft and IBM.

Engadget's summary of the story is much more inflammatory than it needs to be.

Sony agreed to let Microsoft not only see early prototypes of Cell, but purchase components as well. "All three of the original partners had agreed that IBM would eventually sell the Cell to other clients. But it does not seem to have occurred to Sony that IBM would sell key parts of the Cell before it was complete and to Sony's primary videogame-console competitor.

The story dances around the fact that the part of the Cell that Microsoft ended up buying is by far the worst part of the design. It's a purposefully stripped down CPU, meant to be propped up by the SPU cores for important tasks. All the 360 has is three of the stripped-down CPU cores, which aren't even as fast as a real PPC at half the clock speed. Okay, so some of that speed could be recovered with a good compiler, but the point I'm trying to make is that MS really didn't benefit that much.

[Pepelutivruski4]

that says that the PS3 was pushed back a whole year....

i don't think it was pushed back, in fact, i don't think the PS3 should have even been released til early to early mid 2008.

imagine if the PS3 was released the same day as the xbox.... there would be like 10 games released that year.

the ps3 came out a whole year later and there were less than a handful of games ready at release date.

[Icemage]

Who cares? I would rather have Sony focus on making their product and platforms better than wasting energy on bygones. If they want to win the console war, the formula is simple: low priced hardware, good games, proper marketing.

[jswilli1]

I read somewhere that Sony had pulled their R&D portion out of the Cell processor (about a year ago). They did this around the time of the 45nm cell processor while IBM was working on the 32nm cell processor. The first Xbox's came with Intel processors running at 750mhz if I remember correctly, I am not sure what processor they are using to date. I am not sure exactly what stake Microsoft has with IBM and the Cell processor at this point.

[The Don]

they don't need to pay attention to what Microsoft does, just stick to their gameplan...the fun's just about to start...

[Elandyll]

Originally Posted by androvsky

Engadget's summary of the story is much more inflammatory than it needs to be.


The story dances around the fact that the part of the Cell that Microsoft ended up buying is by far the worst part of the design. It's a purposefully stripped down CPU, meant to be propped up by the SPU cores for important tasks. All the 360 has is three of the stripped-down CPU cores, which aren't even as fast as a real PPC at half the clock speed. Okay, so some of that speed could be recovered with a good compiler, but the point I'm trying to make is that MS really didn't benefit that much.

Have you even read the original WSJ article?

http://online.wsj.com/article/SB123069467545545011.html

Like dynasties rising and falling, videogame systems enjoy periods of ascendancy and popular support, only to be thrust aside by a new and conquering power. First came Magnavox Odyssey (in the 1970s), then Atari consoles, then Nintendo, which dominated the market for the better part of the 1980s. In the early 1990s, Nintendo's Super NES and Sega Genesis battled each other for supremacy. Each found enough competitive room to lay the groundwork for the modern videogame console, which has become something like a dedicated personal computer.

It was in the mid-1990s that Sony dropped Playstation into the console market -- a graphics powerhouse that featured games for adults as well as for kids. Playstation was a huge success, selling more than 100 million units. Its 2000 sequel, the Playstation 2, was an even bigger one.

For the system's ambitious third iteration, though, Sony wanted an entirely new processing architecture. Most computer processing chips are built on the foundations of the chips that are already in use. Designing a new chip from the ground up is a costly and time-intensive process. So in 2001 Sony partnered with Toshiba and IBM to create the so-called Cell processor -- a chip so powerful that it would redefine PC-scale power.

David Shippy, as it happens, was in charge of designing the brains of the Cell, the processing core. In "The Race for a New Game Machine," he and his co-worker Mickie Phipps tell the story of the whole effort to build the Cell. They also describe how the project went off the rails, ending up with IBM engineers creating the processing chips for two rival videogame consoles and, along the way, delivering to Sony Corp. one of its greatest business failures.

When the companies entered into their partnership in 2001, Sony, Toshiba and IBM committed themselves to spending $400 million over five years to design the Cell, not counting the millions of dollars it would take to build two production facilities for making the chip itself. IBM provided the bulk of the manpower, with the design team headquartered at its Austin, Texas, offices. Sony and Toshiba sent teams of engineers to Austin to live and work with their partners in an effort to have the Cell ready for the Playstation 3's target launch, Christmas 2005.

But a funny thing happened along the way: A new "partner" entered the picture. In late 2002, Microsoft approached IBM about making the chip for Microsoft's rival game console, the (as yet unnamed) Xbox 360. In 2003, IBM's Adam Bennett showed Microsoft specs for the still-in-development Cell core. Microsoft was interested and contracted with IBM for their own chip, to be built around the core that IBM was still building with Sony.

All three of the original partners had agreed that IBM would eventually sell the Cell to other clients. But it does not seem to have occurred to Sony that IBM would sell key parts of the Cell before it was complete and to Sony's primary videogame-console competitor. The result was that Sony's R&D money was spent creating a component for Microsoft to use against it.
Mr. Shippy and Ms. Phipps detail the resulting absurdity: IBM employees hiding their work from Sony and Toshiba engineers in the cubicles next to them; the Xbox chip being tested a few floors above the Cell design teams. Mr. Shippy says that he felt "contaminated" as he sat down with the Microsoft engineers, helping them to sketch out their architectural requirements with lessons learned from his earlier work on Playstation.
The deal only got worse for Sony. Both designs were delivered on time to IBM's manufacturing division, but there was a problem with the first chip run. Microsoft had had the foresight to order backup manufacturing capacity from a third party. Sony did not and had to wait another six weeks to get their first chips. So Microsoft actually got the chip that Sony helped design before Sony did. In the end, Microsoft's Xbox 360 hit its target launch in November 2005, becoming its own success. Because of various delays, the Playstation 3 was pushed back a full year.
Mr. Shippy and Ms. Phipps view the delivery of the Cell processor and the derivative Xbox chip as victories for both companies. "Both Sony and Microsoft were extremely successful at achieving their goals," they write. But this is true only in the narrowest sense. The new chips certainly set the standard for technical virtuosity. Yet the current generation of videogame console has been dominated not by Sony or Microsoft but by the Wii, Nintendo's modest machine that relies on an older, cheaper and less powerful chip. With an input device that allows players physically to interact with games, the Wii has been yet another runaway success, selling almost as many consoles as the Xbox 360 and Playstation 3 combined.

In fact, the Playstation 3 now runs a distant third in sales. (And the trend is downward: On Monday, The Wall Street Journal reported that "U.S. sales of the PS3 fell 19% last month from a year earlier, while sales doubled for the Wii console and rose 8% for the Xbox 360.") For Sony, the Cell processor was such a debacle that two weeks after the Playstation 3 finally appeared in stores, the company fired Ken Kutaragi, the head of its gaming unit, who had championed the Cell and built the Playstation line. The lesson, lost on Mr. Shippy and Ms. Phipps, is that technical supremacy divorced from sound strategic vision is no virtue. It can even end up in disaster.

[docjan_uk]

This is the real world, and in the real world if you hire IBM to work with you on a chip, engineers from that company are going to use that expertise in designing other chips that your competitors hire them to build.

This really isn't a big deal, and the PS3 was delayed by a year due to the integration of blu-ray and issues with mass producing the diode.

[Elandyll]

Originally Posted by docjan_uk

This is the real world, and in the real world if you hire IBM to work with you on a chip, engineers from that company are going to use that expertise in designing other chips that your competitors hire them to build.

This really isn't a big deal, and the PS3 was delayed by a year due to the integration of blu-ray and issues with mass producing the diode.

Yeah visibly nobody thought it was a big deal at all

IBM employees hiding their work from Sony and Toshiba engineers in the cubicles next to them; the Xbox chip being tested a few floors above the Cell design teams. Mr. Shippy says that he felt "contaminated" as he sat down with the Microsoft engineers, helping them to sketch out their architectural requirements with lessons learned from his earlier work on Playstation.

As to know wether or not it'll have any repercussion, we'll have to see.

[mainman]

True or not, Sony shouldn't sue IBM for this. It would only break their relationship between the 2 companies.

Sony could use this as leverage in future negotiations between the 2 companies though.

[york weir]

Why would Sony have a lawsuit against Microsoft in this?

Sony, IBM and Toshiba all agreed the tech would be used elsewhere. Along comes Microsoft wanting IBM to built a chip for them so they use lessons learned and some of the same tech. It simply sounds like a business deal to me rather than demonizing Microsoft because they are a popular lightning rod.

If GM, Ford and Bose decide to partner and design a new radio for a car to where the tech they learned will be sold elsewhere and then along comes Nissan wanting Bose to design them a system, there is no reason to be angered that they share some of the tech.

Now, if Sony, Toshiba and IBM entered in to agreements where this was the SOLE purpose of the chip them Sony could have a lawsuit against IBM.

This just comes across as an article venting about Microsoft releasing their product earlier than Sony even though this same chip was not the cause of the ps3 delay.

It also sounds like Sony wasn't thinking. They had no idea IBM might be contracted to built a chip for the xbox and also didn't have any contingency planning to order backup manufacturing capacity.

[Rike255]

I was just thinking the same thing. Depending on the agreement, Sony may be able to start something with IBM (although it sounds like all 3 companies agreed the tech would be used elsewhere). In any case, Microsoft didn't do anything wrong. It's not like MS can push IBM around anyways.

[york weir]

Originally Posted by Rike255

I was just thinking the same thing. Depending on the agreement, Sony may be able to start something with IBM (although it sounds like all 3 companies agreed the tech would be used elsewhere). In any case, Microsoft didn't do anything wrong. It's not like MS can push IBM around anyways.

I'm not sure if they have a lawsuit at all though. Regardless of when they sell a chip to someone else, if it uses any of the same tech it would have been paid for by Sony R&D.

[Rike255]

Originally Posted by york weir

I'm not sure if they have a lawsuit at all though. Regardless of when they sell a chip to someone else, if it uses any of the same tech it would have been paid for by Sony R&D.

That's why I said "Depending on the agreement ... (although it sounds like all 3 companies agreed the tech would be used elsewhere)"

[Simplayer]

I doubt they'd have a case. The 360 uses 3 modified PowerPC chips, IBM's tech, while the PS3 uses a very similarly modified PowerPC chip and the 7-8 SPUs. Sony's R&D money did not go into the PowerPC chip but rather the SPUs.

[york weir]

Originally Posted by Rike255

That's why I said "Depending on the agreement ... (although it sounds like all 3 companies agreed the tech would be used elsewhere)"

[joeorc]

Originally Posted by jswilli1

I read somewhere that Sony had pulled their R&D portion out of the Cell processor (about a year ago). They did this around the time of the 45nm cell processor while IBM was working on the 32nm cell processor. The first Xbox's came with Intel processors running at 750mhz if I remember correctly, I am not sure what processor they are using to date. I am not sure exactly what stake Microsoft has with IBM and the Cell processor at this point.

IBM powerPC

processor's

all three

nintendo
sony
microsoft

all are powerPC processor's..

[joeorc]

Originally Posted by docjan_uk

This is the real world, and in the real world if you hire IBM to work with you on a chip, engineers from that company are going to use that expertise in designing other chips that your competitors hire them to build.

This really isn't a big deal, and the PS3 was delayed by a year due to the integration of blu-ray and issues with mass producing the diode.

it was also not just blu-ray, also the the development kits were few and far between at that time. not enough software was done , and that has been one of the thing's that has slowed the playstation 3, beside's the big one being "PRICE" now that the developer's have their ENGINE's built for the Cell more Software will be able to be produced, from 1st party , 2nd and some 3rd party who have been working on their Engines.

[Elandyll]

Originally Posted by Rike255

That's why I said "Depending on the agreement ... (although it sounds like all 3 companies agreed the tech would be used elsewhere)"

I'm not sure they'd have a case either, depending on the agreed terms of the contract.
This being said, and given the book extracts -IF- everything is true, this is a more than disgusting situation.

You can't say that everything was just business as usual for IBM, their engineers knew it was fishy, hence hiding (per the book), because I doubt that working for a direct competitor of the one funding the research for some of the elements of the Proc you are designing for said direct competitor is considered "ethically fine".

The difference is probably not Legal vs Illegal here (I'm pretty sure MS and IBM are backed up with the number of lawsuits they have been targeted with in the past - although I would be rather pleased with IBM and MS being slammed by a few dozen Million dollar fine in this case if true), but rather ethic vs unethical.

Where do we draw the line?
Sony "forgot" to mention that IBM couldn't use Cell components -while it was still being designed- to make components for their most direct competitor aka Microsoft?
So ... what IBM did is ... fine ... ?

[Rike255]

Oh I agree completely, business ethics are a completely different thing though. Withing limits, you can't sue someone over being "unethical" as long as it's still legal.

Major corporations will do anything to make a buck. It's really terrible what they'll even consider doing, especially when it comes to corporations dealing with employees or third world populations. Note I'm not pointing at any company in particular.