The new, smaller gaming console will carry an upgraded version of the Cell microprocessor jointly developed by IBM, Sony and Toshiba.
According to Big Blue, it is fabbed using a 45nm manufacturing process. It will still use IBM's Power CPU architecture but will draw less power than earlier chips.
The earlier PS3 console carried a Cell processor manufactured using the 65nm process. Sadly IBM tells us that speed wise it will all be the same, but our power bills will be smaller.
The smaller chips cost less to produce, which contributed to Sony's decision to cut the console's price overseas to US$299. A Sony executive said the advanced manufacturing process was a factor in driving the console's price down.
Earlier consoles carried the RSX GPU developed jointly by Nvidia and Sony. The graphics core in the PS3 Slim has to be compatible with the RSX GPUs so existing games for the PS3 can run on the new console.
More details on the PS3 Slim are available here.