Earlier this year we heard that Sony and Toshiba had successfully shrunk the 65nm Cell processor that powers the PlayStation 3, down to 45nm. Though the companies were previously rumored to be moving the console chip onto the newer process in autumn this year, Japan's Nikkan Kogyo is now reporting that mass production of the 45nm Cell processor is set to begin sometime in 2009.

The smaller chip will use about 40 percent less power than its 65nm predecessor, meaning Sony can cut down on the amount of cooling required by the console, which in turn will make it cheaper to produce and improve the company’s margins. From a consumer perspective, this of course opens the door to possible price drops in 2009, which would be a logical move for Sony now that a vanilla version Xbox 360 can be bought for half the price of a PlayStation 3.