RealTime IT News

IBM Snatches Chip Deal

IBM's new chip foundry has won a new semiconductor order from Taiwan's VIA Technologies and snatched a key contract from Taiwan's TSMC in the process.

"This is a good example of how clients turn to IBM when they require advanced technology and manufacturing know-how," IBM spokesman Chris Andrews told internetnews.com. Terms of the deal were not disclosed.

Company officials said a key advantage for IBM was its silicon-on-insulator technology, which helps produce high-speed, high-performance, low-power chips.

Production on VIA chips will begin in the second half of 2004 at IBM's Fishkill, N.Y., plant, not far from the company's Armonk, N.Y., headquarters. It's the first deal between the two companies.

The $3 billion chip foundry was opened in the summer of 2002 and houses IBM's Microelectronics business. The capital investment came at a time when the semiconductor business was in a cyclical trough.

More recent data shows that the chip industry is growing again, thanks to demand for PC, mobile phones, consumer devices and cars.

For VIA, the new chips will help it push into new markets.

"VIA processors are spurring the development of exciting new devices in areas such as the connected home and mobile entertainment," VIA CEO Wenchi Chen said in a statement.

VIA said that while its next-generation chips will be made by IBM, the Taiwan Semiconductor Manufacturing Corporation (TSMC) will continue to produce VIA's existing processor lines as well as its core logic chipsets and advanced communications, networking and multimedia products.