Japanese electronics giant Sony has teamed up with German-based chip maker Qimonda to design dynamic random access memory (DRAM) chips for consumer and graphics applications.

The new Tokyo-based 50:50 joint venture has been dubbed Qreatic Design with work expected to kick off by the end of this year, the two companies said in a statement.

Terms of the deal, which is subject to regulatory approval, were undisclosed.

The partnership underlines an increasing desire among the world's chip makers to combine forces in a squeezed market, sharing design and production costs.

Qimonda chief executive Kin Wah Loh said Japan was "an important and dynamic market" for the firm and the hope was to "expand" its activities in the region.

He added that the partnership would help Qimonda develop "product diversification in non-PC applications".

The move comes as little surprise given the current state of play within the OEM DRAM industry where demand is booming but prices are plummeting.

The Qreatic team will be intially made up of 30 "specialists" from Sony and Qimonda working on developing DRAM chips for mobile phones and game consoles, which could prove a lucrative market for both firms to tap into. ®