The European Commission announced Friday that it has approved the creation of an optical disc drive (ODD) joint venture between Sony and NEC.
Under the joint venture, the Japanese companies will work together in the development, design and marketing of optical data-storage disk drives, including re-writable CDs and DVDs. Disk production will be outsourced.
The joint venture will replace both companies' own activities in the market, the Commission said.
The venture, Sony NEC Optiarc, will neither reduce competition nor consumer choice, since it will face competition from various companies, including Hitachi, Toshiba, Samsung, Pioneer, Panasonic and Lite-On, the Commission said.
Sony will hold a 55 percent stake with NEC holding the remaining 45 percent of the company, which will start operations in April.