According to the book 'The Race for a New Game Machine', Sony had unknowingly funded Microsoft's own efforts to develop a videogame console.
Microsoft also managed to get their chip produced six weeks before Sony too. IBM employees hid their collaboration with Microsoft from Sony and Toshiba engineers.
David Shippy and Mickie Phipps, both chip designers, describe the crazy goings on in their book and how Sony inadvertently handed a major weapon into the hands of Microsoft.
"In late 2002, Microsoft approached IBM about making the chip for Microsoft's rival game console, the (as yet unnamed) Xbox 360," reports the .
"In 2003, IBM's Adam Bennett showed Microsoft specs for the still-in-development Cell core. Microsoft was interested and contracted with IBM for their own chip, to be built around the core that IBM was still building with Sony."
It was here that everything went downhill for Sony's competitive edge.
"All three of the original partners had agreed that IBM would eventually sell the Cell to other clients. But it does not seem to have occurred to Sony that IBM would sell key parts of the Cell before it was complete and to Sony's primary videogame-console competitor."
"The result was that Sony's R&D money was spent creating a component for Microsoft to use against it." Still, whose laughing at the end of all this? That's right its Nintendo with their inferior Wii chipset.
Cheaters and big spenders don't always prosper, sometimes it takes a little guy with a swooshing controller to achieve true greatness.