Rambus license to have little impact on new NEC DRAM joint venture
By Jack Robertson, Electronic Buyers' News
Sep 18, 2000 (8:34 AM)
URL: ebnews.com
OEMs contracting with NEC Corp. shouldn't expect last week's patent licensing deal between NEC and Rambus Inc. to affect their DRAM prices, given that the Japanese chip maker will cease paying royalties on these devices as of Jan 1. That's the date that NEC opens the doors on a joint-venture DRAM company with Hitachi Ltd., creating a development and marketing concern that so far has brokered no known agreement to license Rambus' synchronous-interface patents.
An NEC spokesman in Tokyo last week confirmed that the company is now paying royalties for synchronous-memory technology used to manufacture SDRAM and double-data-rate SDRAM, and will continue to do so through the end of the year.
"After that, all our [development and marketing] DRAM operations are transferred to NEC Hitachi Memory Inc., which is a separate entity," he said.
In the short term, NEC's customers are likely to sidestep DDR SDRAM royalties, largely because the next-generation chips aren't expected to enter volume production until the beginning of 2001. That should come as a relief to OEMs, which have been monitoring a patent saga that has so far involved Rambus and several of the industry's largest DRAM makers in a legal imbroglio.
The next question for systems makers is whether NEC Hitachi Memory will be as conciliatory toward Rambus' demands in its new incarnation as the companies were as distinct vendors. Hitachi, too, bowed to the Rambus royalty decree under an agreement that also is due to expire when the supplier restructures its DRAM business next year.
Some analysts claim the royalty deals were brokered in most part to remove a legal obstacle that might otherwise have complicated the formation of the new company.
"Both NEC and Hitachi wanted to avert any Rambus legal action that could impede the launch of the new joint venture," said Bob Merritt, an analyst at Semico Research Corp. based in Redwood City, Calif. "They're now assured they can start with a clean slate."
The NEC spokesman refused to indicate whether the DRAM combine would be amenable to Rambus' terms, saying that it was an issue for NEC Hitachi Memory to address. The new company still has no official channels of communication and could not be reached for comment.
In its announcement last week that it had signed the industry's fourth-largest DRAM maker to a patent license, Rambus, Mountain View, Calif., made little mention of the terms of the agreement, the length of the deal, or whether it intended to negotiate a new accord with NEC Hitachi Memory.
Rambus executives did not respond to repeated attempts seeking comment on the issue.
The willingness of Hitachi and NEC to sign short-term protective deals with Rambus gives no indication as to what the joint venture might do, said Nathan Brookwood, an analyst at InSight64, a Saratoga, Calif., market research firm. "That would be the really significant licensing agreement," Brookwood said.
Though the patent dispute has revolved around the central issue of DRAM, the licensing deals signed by NEC and Hitachi also extend to the companies' respective microprocessors lines, because both use a synchronous interface. Unlike the DRAM provision, however, the processor businesses will remain with the parent companies and continue to generate royalties for Rambus over the life of the agreements.
As it was signing NEC last week, Rambus' patent defense developed further when it added new infringement suits against Hyundai Electronics Industries Co. Ltd., Infineon Technologies AG, and Micron Technology Inc. in European courts. The design company also filed a petition with the International Trade Commission seeking to block the import of Hyundai SDRAM into the United States.
Since it named -- and then later dropped -- Sega Enterprises Ltd. from a short-lived suit filed earlier this year against Hitachi, Rambus has made no new moves to add OEMs to its roster of legal targets.
The sheer number of lawsuits involving Rambus in courts worldwide is running up the company's legal expenses, and may have lessened the chance that it would involve OEMs, Semico's Merritt said. An executive at one DRAM company agreed, saying, "Most of our OEM customers are now watching the Rambus legal battles closely, after taking their own precautions early on."
In addition to at least temporarily clearing any SDRAM-related legal issues, NEC's patent license gives it rights to develop a 1.06-GHz Direct Rambus DRAM chip. Separately, Rambus last week said that Panasonic and Sony are shipping 128-Mbit Direct RDRAM in HDTV set-top boxes that are processing digital satellite broadcasts from the Sydney, Australia, Olympic games. |
