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To: phbolton who wrote (43520)	3/6/1999 7:17:00 PM
From: DJBEINO	Respond to of 53903

EDO users in squeeze play Jack Robertson EDO DRAM users-from Intel Xeon server OEMs to telecom vendors-are scrambling to find EDO memory chips, and they're paying more for them. The global production of EDO DRAM is expected to be cut in half this year as chip makers shift fabs rapidly to more leading-edge devices. Analyst Sherry Garber of Semico Research Corp., Phoenix, estimates that unit sales of EDO chips will drop from 1.02 billion units in 1998 to 546 million units this year, and to 463 million in 2000. EDO prices, meanwhile, have risen 10% to 15% over the past few months. Spot-market prices reflect similar increases, with some high-volume parts, such as 16-Mbit x 4 chips, costing even more. Few buyers of EDO memory expected such a quick fallout in supply-and certainly didn't think prices would start spiraling upward. "The rising EDO prices defeat the purpose of using EDO as an inexpensive memory chip," said Adrian Proctor, general manager at memory-module maker Dane-Elec, Irvine, Calif. "Systems that depend on EDO to cut their memory cost are now caught in a squeeze with the rising EDO prices." The EDO dilemma is particularly ironic for Intel Corp.'s leading-edge Pentium Xeon chip for servers. The current Xeon chipset supports only EDO DRAM, which was a good low-cost memory solution for the high-end server at the time the chipset was designed years ago. At that time, servers typically used the least expensive memory available and ganged it together in high-bandwidth channels. "Intel is just one of many companies that didn't expect EDO to fall off as quickly as it has," said David Pulling, vice president of marketing for chipset vendor Reliance Computer Corp., San Jose. Now they have to live with the realities of a vastly changed market." Pulling, however, hopes to benefit at Intel's expense by providing server OEMs with an independent Xeon chipset that can interface with either PC-100 or the new PC-133 SDRAM chips. Pulling said he doubts that Intel deliberately excluded an SDRAM interface in its Xeon chipset as a strategic move to avoid creating any rival to Direct Rambus DRAM. He added that he believes Intel will rectify the Xeon memory problem in its upcoming next-generation Carmel chipset for the Pentium III Xeon by adding an SDRAM interface. Analysts noted that many server companies traditionally have made their own chipsets to interface with Intel processors. The reason virtually all Xeon buyers initially used the Intel chipset tied to EDO memory was to get to market quickly. Now, as these OEMs reach a routine Xeon-server upgrade in their line, they can redesign boards and develop or buy independent chipsets using SDRAM. "OEMs should have seen the EDO shortage coming last year and taken steps to get adequate supply," Semico's Garber said. Rising EDO prices hit telecom and consumer-electronics products especially hard, she added, since their life cycle is often much longer than that of PCs, and OEMs have less opportunity to switch from EDO memory to mainstream SDRAM. As their major suppliers exit EDO production, many large OEMs are now talking with second- and third-tier DRAM makers that continue to produce the older chips. None of these OEMs is reported desperate enough yet to start stocking up on EDO memory, although purchasers are asking for longer-term contracts for price protection. Copyright ® 1999 CMP Media Inc. techweb.com