RealTime IT News

Saifun Makes Up with AMD, Fujitsu

Saifun Semiconductors Wednesday agreed to bury the legal hatchet with rivals AMD and Fujitsu, pledging to instead cross-license patents and technology and collaborate in the development of non-volatile memory with the firms.

As part of the collaboration, AMD and Fujitsu will also take an equity stake in Israeli-based Saifun.

The lawsuit, filed by Saifun In February of 2002, alleged that the company disclosed "revolutionary" memory chip technology to AMD and Fujitsu after the companies agreed to keep the information secret.

According to the suit, both companies used the technology to develop their own memory chip products. Saifun had sought an order blocking the companies from infringing its patent.

According to Dr. Bertrand Cambou, group vice president of AMD's Memory Group, AMD and Fujitsu will now be able to not only license Saifun's NROM technology, but also leverage its engineering resources.

"The recognition of our technology and intellectual property by these industry leaders validates Saifun as a leader in non-volatile memory technology," stated Dr. Boaz Eitan, president and CEO of Saifun.

Citing an agreement with Saifun, a spokesman for AMD refused to comment on the terms of the settlement, while neither Fujitsu nor Saifun could be reached early this morning.

Israel's Ha'aretz newspaper, however, reports that under the terms of the agreement signed for a ten-year period, the two companies will pay Saifun $25 million for the license to use its Flash Memory.

In addition, AMD will invest $15 million and Fujitsu $10 million, for which the companies will recieve a 4.5 percent share in Saifun, the newspaper said.

According to Jim Cantore, memory analyst for iSuppli, the settlement was a smart move for the companies.

"Any time the companies can come to a reasonable agreement, it's better than following some long drawn-out litigation," said Cantore. "All in all it's a plus for the industry because ultimately it will end up giving users of multi-level high-density flash more choices."

The move also puts AMD and Fujitsu in a stronger position to battle market leader Intel.

"It's a very bold but necessary move by both AMD and Fujitsu to counter the multilevel cell technology that Intel pioneered with its StrataFlash," said Cantore. 'As this technology moves ahead, and they develop more advanced processes using this new technology, it's probably awfully good that they stay close to the original creator of the NROM Technology."

According to the latest research from iSuppli, the flash market is in the middle of a recovery, meaning that it is likely to finish below last years number of $7.6 billion.

"We have come through the worst of this particular flash memory downturn, where revenue has bottomed in the first quarter of this year," said Jim Cantore, memory analyst for iSuppli.

Looking ahead to 2003 the analyst expects to see some tightening in capacity and continued growth in the Flash Market in excess of 14 percent.