Sony & NEC

It looks like optical drive nuptials are happening. Does this make LiteOn, Sony's former drive maker, "the other woman?"

Sony and NEC have concluded a basic agreement to merge their optical-disc drive businesses into a new company, the companies have announced.

The two companies hope to launch the new venture on April 1, 2006, which is the first day of the new financial year in Japan. Sony will hold a 55 percent stake in the as-yet-unnamed company and NEC will hold the remaining 45 percent stake, according to the terms of a memorandum of understanding signed by the companies.

The new joint venture will work on planning, design, manufacturing, and marketing of optical-disc drives for products such as personal computers and DVD players, they said in a statement. In the next-generation optical disc market the company will manufacture drives for both the HD-DVD format, of which NEC is a major backer, and Blu-ray Disc, of which Sony is a leading supporter, both companies said.