Fujitsu, AMD boost their flash partnership

Fujitsu and Advanced Micro Devices have expanded their long-time flash memory

chip alliance by announcing plans to spend $2 billion on new flash IC fabs. The

plans include setting up a $1.3 billion facility at Fukushima in northern Japan.

This is in addition to two other flash production fabs they already co-own and

operate.

The announcement came just one day after Intel said it would also spend $2

billion to increase its flash memory chip production in the face of booming

global demand.

The AMD-Fujitsu fab would produce as many as 13 million flash memory chips

per month by March 2002. Initially, chips with 16-megabit capacity will be

manufactured using a 0.23-micron manufacturing process. This will be improved to

0.18 micron by 2002. The two partners have finalized plans for boosting the

output to 52 million chips per month by March 2003.

Demand for the flash memories is outstripping supply. "We predict that

the worldwide flash memory chip market will grow by 91 per cent this year to

about $8.42 billion," said Fujitsu executive Hirofumi Takeda.

The two companies will split the cost of the new plant 50:50, or $655 million

each. They will invest another $650 million to triple the flash memory

production at a fab in Oregon. The plant’s current output is around 10,000

8-inch wafers per month. That will increase to 30,000 wafers a month by 2003.

Sales of flash memory chips are expected to rise to about $15 billion in

2002, up from about $8 billion in 2000, according to researcher Dataquest.