Intel Reportedly Makes Big Chip Deal With Ericsson
NEW YORK (Reuters) - Computer chip maker Intel Corp. (NasdaqNM:INTC - news) has agreed to supply Telefon AB
LM Ericsson (LMEb.ST), the world's Number 3 cellular phone maker, with $1.5 billion in flash-memory chips over the next
three years, the Wall Street Journal reported Thursday.
The deal with Swedish Ericsson is one of Intel's first major agreements in its effort to move rapidly into the fast-growing
cellular phone market, the Journal said.
The deal ensures a steady supply of chips for Ericsson when the demand for flash-memory is heating up, the newspaper said.
Unlike standard memory, flash chips store data even when a phone or computer is turned off, the newspaper said. Flash
memory is becoming an increasingly important component in mobile phones, palm computer organizers, digital cameras and
players that download music from the Internet, the Journal said.
Demand for flash memory is expected to soar as phones acquire more memory to access the Web, the newspaper said.
Santa Clara-based Intel also said it would buy a chip making facility in Colorado Springs, Colo., from Rockwell International
Corp. (NYSE:ROK - news) and invest $1.5 billion to upgrade it.
The Journal reported that Intel would convert one of the factories at the facility to produce flash-memory chips.
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