WSJ today....
January 18, 2000
Six Chip Makers Form Group
To Develop New Technology
By RUSSELL FLANNERY
Staff Reporter of THE WALL STREET JOURNAL
Facing rising product-development costs, six of the
world's largest semiconductor manufacturers said they
would join forces to develop new technology for the
most common type of memory chip used inside personal
computers.
The six are Intel Corp. and Micron Technology Inc. of
the U.S.; NEC Corp. of Japan; Samsung Electronics Co.
and Hyundai Electronics Industries Co. of South Korea;
and Infineon Technologies AG, a unit of Germany's
Siemens AG. The group-excluding Intel, which mainly
makes microprocessors-accounts for about 70% of the
global market for dynamic random access memory, or
DRAM. That market reached $21 billion last year,
according to research firm Dataquest Inc.
"We have to pour lots of money into developing
next-generation DRAM," said Simon Hong, the market
communications manager in Seoul for Hyundai
MicroElectronics, the semiconductor unit of Hyundai
Electronics. The unusually broad alliance should be
"more cost effective" than going it alone, he said.
A statement by the six companies vaguely referred to a
goal of developing "high-performance advanced DRAM
technology" that would be in the marketplace in 2003.
The group said it would provide information to facilitate
the development of related PC components such as a
chipset, which acts as an intermediary between DRAM
and the central processing unit, or CPU. The market for
CPUs, which do the computational heavy lifting inside a
PC, is about 80% controlled by Intel under its brands
such as "Pentium" and "Celeron." Consumer interest for
high-performance PCs that provide advanced multimedia
and graphics is pushing Intel to develop higher-speed
CPUs that require more powerful yet affordable DRAM
chips.
The announcement of the alliance follows uncertainties
surrounding Intel's much ballyhooed chipsets, based on
technology developed by Rambus Inc., that were
supposed to help create a jump in PC performance. "The
entire DRAM and PC industry has suffered from delays
and confusion about Rambus," said Don Floyd, regional
semiconductor-industry analyst at Credit Lyonnais
Securities in Taipei.
By working on technology that will be in the market a
full three years from now, the alliance is trying to look
beyond the current battle lines of industry competition.
Each member of the alliance will commit a design team
to the project, which will be overseen by a senior
technology committee, said a Samsung official, adding
that different roles haven't been set. No budget figures
were available.
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