Sharp and Toshiba Team up on Flat Panels

A new agreement will have Sharp supplying LCD panels to Sharp, and Sharp supplying image-processing chips to Toshiba.

Despite fierce competition on the surface of the flat panel television market, under the all the brand names and marketing, many manufacturers actually share the same parts in their televisions. Toshiba and Sharp, already allies in the flat panel business, strengthened their agreement on Friday with a deal that will allow Toshiba to buy large LCD panels directly from Sharp.

According to BusinessWeek, The panels will come from Sharp’s new $3.4-billion factory in Osaka Prefecture, Japan. In exchange, Toshiba will supply Sharp with image-processing chips. Both companies hope the agreement will allow them to focus on their respective specialties and work cooperatively.

Financially, the deal seems to have gone over well. On Friday, shares of Toshiba and Sharp stock rose 2.5 percent and 2.9 percent respectively, on Japan’s Nikkei exchange.