Rambus: It finally works!
By Om Malik
NEW YORK. 5:40 PM EDT-Like a cat with nine lives, Rambus (nasdaq: RMBS) of Santa Clara, Calif., is staging a comeback, thanks to some smart handiwork by Intel (nasdaq: INTC) engineers.
Rambus stock nosedived in late September when Intel disclosed that its Camino 820 chipset would be delayed because of memory-bus-related problems. Seen as the next step in the chip-set food chain, Camino is seen as critical to Rambus' fiscal future. In three trading sessions, Rambus dropped almost 50%, from $117.50 a share to about $59 a share.
Now the word is that Intel has fixed these problems and may announce the production schedule as early as this Friday. Intel and Rambus have not publicly disclosed what the problems are, but industry newsletter The Microprocessor Report says that there are memory-reliability issues on systems that have three memory slots.
"The problem was with some of the wiring specifications, and it seems they have fixed those issues," says a person familiar with Intel and Rambus. "The big question is can Intel convince the computer makers (OEMs) to re-launch systems in the fourth quarter."
Beyond the Camino 820 chipset, Intel is said to be facing no problems when it comes to Rambus-related memory. On Friday, Intel may also announce that the Carmel 840 multiprocessing chipset, which uses Rambus-technology, has no quality issues and will probably go into production in the first week of December 1999, dispelling any rumors that future chipsets would also be plagued with problems.
When contacted in Japan, Rambus Chief Executive and President Geoffrey Tate declined to comment. "We are working hard to fix the problems and are not saying anything until we are ready to ship," says Tate. Rambus closed up 31 cents a share to $70.12.
Rambus is one of a new breed of technology companies that makes no product, instead licensing its technology to others in exchange for royalty payments. Rambus makes the technology known as Direct RDRAM, which allows the dynamic random access memory (DRAM) to communicate on an accelerated basis with the superfast microprocessors, thereby increasing the performance of those computers.
Intel is one of the company's biggest backers and has been browbeating memory chip makers like Samsung and Micron Technology (nyse: MU) to support Rambus-standard. However, Rambus' plans for global DRAM domination stopped on September 27 when Intel announced that it was delaying the release of its 820-chipset because flaws had been discovered in the chip's Rambus-based memory technology. The chipset is essentially a combination of chips that controls the flow of data within a computer
Intel's 820 is the first chipset made by Intel that supports the 4X Accelerated Graphics Port (AGP) interface and a 133 MHz front-side bus that matches the speed of the latest high-speed processors running at 533 MHz and 600 MHz speeds. At the time, Intel said it would have to resolve platform validation issues before it can ship the 820. Shares of Rambus fell almost 50% to $59 on the news.
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