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To: J. P. who wrote (42617)	1/31/1999 3:11:00 PM
From: DJBEINO	Respond to of 53903

Toshiba, Fujitsu Close To Signing DRAM Cross-Supply Deal Monday, February 1, 1999 TOKYO (Nikkei)--Toshiba Corp. (6502) and Fujitsu Ltd. (6702) are expected to soon agree on a landmark tie-up under which each partner will specialize in production of different types of DRAM chips for mutual supply from 2000, The Nihon Keizai Shimbun learned Sunday. The deal would be the first of its kind between Japanese chipmakers, which have been hit by the prolonged downturn in worldwide DRAM prices. Last December, the two agreed to cooperate on development of an advanced memory chip to cut R&D costs. They are now seen extending those savings to the production stage. Under the arrangement, Toshiba would make and supply Fujitsu with memory chips for personal computers -- which account for 80% of the global DRAM market -- while Fujitsu will produce advanced memories for computer servers and digitized consumer electronics products. The two companies see the deal as a way of limiting expenditures on plant and equipment in the capital-intensive industry. The cross-supply will involve several million chips per month from each company, starting with Toshiba supplying a new high-speed DRAM for PCs this summer. Fujitsu will sell the Toshiba chips under its name. Fujitsu, meanwhile, will begin supplying its DDR DRAM for servers and an FCRAM-format memory for image processing in digitized consumer electronics from 2000, when it starts mass producing the new chips. Among 20 DRAM makers worldwide, Toshiba ranks eighth and Fujitsu 10th.