We've been keeping tabs on the reduction of the Cell processor's size, and today IBM announced that Cell hardware sized 65nm is now in full blown production. As a cost-cutting measure, Sony and IBM acted quick on downsizing the dimensions of the Cell chip from 90nm to 65nm, which in turn helps lower the cost of producing the chips.

What does this mean to you? Well, a PS3 that's cheaper to produce is a PS3 that'll have wiggle room for a price-drop. Moreover, another revision of the chip is expected to occur in late 2008 or early 2009. This said chip will be 45nm, or possibly smaller.

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