Sony has agreed to form a joint venture to design memory chips with the German firm Qimonda.
Memory chips are used to store information on products such as mobile phones and digital cameras.
Sony's decision to agree a joint venture highlights the growing trend of chip makers sharing the large costs of design and manufacture.
The price of these processors has also been falling and this has squeezed the profits of manufacturers.
Samsung, the world's largest supplier of memory chips, has been complaining about over-supply in the industry.
Chip boost
Undaunted, Sony executives have said they want to boost the company's expertise in this area.
"We believe the integration of both company's technological strengths will lead to unprecedented levels of creativity and design that will continue to develop in the future," said Yutaka Nakagawa, executive deputy president at Sony.
The last five years has seen memory chips used as storage in a wide range of new products.
For example, the latest MP3 players use flash memory rather than hard drive memory. Memory chips are also used to store pictures in digital cameras.
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