Does Sony own rights to the Cell design in the same way that Microsoft owns rights to it's chip design??

Yes, Sony along with IBM and Toshiba co-designed the Cell.

ok. but how come I only hear about Microsoft being the clever one with IP ownership so that they have much more leverage in how much suppliers can charge for it? What is an IP btw?

IP = Intellectual Property

Microsoft patents everything they even think of while getting a drink at the water cooler, same with Sony. In terms of the gaming/PC/software world, Microsoft might have more patents, hence why you would see people saying they have more IP, although I would bet Sony has patented more, but they also have TVs, CD players, etc...

Because they were the stupid one last generation. They didn't own the IP to the Xbox hardware, and that changed for the 360. Sony, on the other hand, already had IP on the Emotion Engine (joint with Toshiba), and now also has with the Cell (with IBM and Toshiba). Nothing changed, so no news there.

ok. Thanks KruzeS.  btw, i've been scratching my head about this one for a while, so its a good thing to have finally cleared it up.  peace