Compaq and Samsung sign Alpha processor pact

Compaq has announced a pact with Korea’s Samsung, which will manufacture the latest Alpha processors under a new $500 million joint development, marketing and manufacturing pact.

Samsung currently produces Alpha chips for Compaq. "The marriage is a good and healthy one. We wouldn't be adding to it if it weren't " said Compaq Alpha server division VP marketing Rick Frazier. Ever since Compaq acquired the Alpha processor business with the acquisition of Digital Equipment, sales of servers powered by the Alpha chips, have declined. But the momentum is turning as Alpha servers are finding new homes at Internet service providers who

appreciate their blazing speed of the chips. Compaq’s Alpha server business is expected to grow 40% to $140 million this year. Rumors also have it that IBM is interested in licensing the Alpha processor technology from Compaq to build a new line of high-power Web servers.

Performance of the Alpha chips can be expected to increase dramatically from the Compaq-Samsung pact, which includes an agreement on developing a copper-based interconnect manufacturing process. Compaq’s Alpha-based computers will no longer run the Windows NT OS, but exclusively run under Unix and OpenVMS operating systems.