Update: http://www.driverheaven.net/news.php?newsid=344 has now received clarification on this from IBM, to quote: "only one CPU development cycle is being 'halted' which is the successor to the current PowerXCell-8i cpu. IBM have said they are planning to work on other CPU's in the Cell Processor 'family'."
Today PlayStationUniversity.com (linked above) is reporting that IBM's Vice President David Turek http://www.heise.de/newsticker/meldung/SC09-IBM-laesst-Cell-Prozessor-auslaufen-864497.html that Cell processor development will be phased out.
Apparently the planned 32 SPE Cell processor will not be made, and their current PowerXCell 8i will be the company's last entrance in the technology.
To quote: "The Cell Processor was originally the brain child of 'The Father of PlayStation' Ken Kutaragi. It was later co-developed by Sony, IBM and Toshiba; making its way into the PlayStation 3, TV's and super computers.
So what does this mean for Sony and the PlayStation 4? Will this change with IBM pulling out of their own development?
Not necessarily. Sony can still hire IBM to create a Cell Processor for their next console, without IBM being involved in their own internal development outside of the PS4."
More PlayStation 3 News...