Sony is reported to be preparing to buy out Ericsson's half of their joint mobile handset business, for an unspecified sum.
A report in the Wall Street Journal estimates that the price would probably be around $1.3 to $1.7 billion. Sony Ericsson was formulated as a joint venture between the two companies ten years ago in 2001.
The company's latest product was the Xperia Play, the manifestation of the long-rumoured 'PlayStation Phone'. Featuring PlayStation branding, controls and a PSone back catalogue, the phone was designed to bridge the gap between handheld gaming devices and smartphones in response to Apple's cornering of the mobile gaming market.
However, sales of the handset have been relatively low so far, despite a recent marketing push. Speaking to GamesIndustry.biz at Gamescom in Cologne this year, Sony Ericsson's head of content marketing & strategy Tim Harrison discussed plans for the brand.
"We're not able to share any official sales figures as yet, but just to say where we are in terms of the journey - obviously the device has been out for a number of months but it's still very early in its lifespan.
"We're still very much building the overall content story - we obviously released with a bunch of games and we've announced a great new catalogue of games here at Gamescom. We've got a really broad cross-section of content for it."
Asked about the distinction between the Play and the forthcoming Vita, and whether the overlap caused any company tensions, Harrison was keen to stress the delineation between the two halves of the corporation.
"I don't know whether it's formal or not," he replied when asked about the prevention of feature creep. "This is primarily a smartphone, we're not trying to pretend otherwise. It's always been positioned and marketed as a smartphone that does great gaming. It's not a handheld portable gaming console - we believe that they are different markets and that there's room for both in the market.
"A mad keen crazy gamer will buy every device under the sun, but this is very firmly positioned as a smartphone with a gaming optimised control pad. Smartphone gaming has seen a massive surge of growth in the last two or three years, especially on Android in the past year.
"What we're trying to do is position ourselves as part of that, but because we have a Sony heritage, because we have a PlayStation certified device, because we have the access to PlayStation classic games, and by the end of the year full access to the PlayStation store, this is very much a smartphone that has access to the gaming audience as well. So we see them very much as distinctive devices."
Sony has been contacted for comment on the potential merger.