Sony Corp. and railway operator Tokyu Corp. signed a memorandum of understanding Friday to form a strategic alliance to jointly promote broadband network business.
Based on the agreement, Sony will acquire 10 percent of all outstanding stocks of Tokyu Cable Television, a deal that will cost about 10 billion yen, company officials said.
Tokyu Cable Television is a subsidiary of Tokyu Corp.
The company now offers CATV services to 250,000 households in Tokyo and Kanagawa, as well as Internet connection services to 20,000 households in the same area.
The alliance will greatly contribute to broadband content services that Sony is now planning, including those provided via Sony's latest game console, PlayStation2, the company officials said.
Sony, Tokyu and Tokyu CATV will discuss further details of joint business, including the possibility of Sony's subscription of new stocks of Tokyu CATV to fund joint projects, the company officials said.
Sony will provide content and technologies to build broadband platforms, which will be connected to Sony's home electronic appliances.
Tokyu will mainly provide high-speed network infrastructures, the officials said.