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Agere Grabs $200M Chip, Software Deal

Extending its relationship with an important customer, communications semiconductor specialist Agere Systems has signed a new $200 million supply contract with mobile phone maker Samsung.

The Agere-powered handsets will support a number of applications including high-speed Internet, video downloads and Java-enabled video games.

"We go back as far as 2000 with Samsung," Glen Haley, a spokesman for Allentown, Pa.-based Agere told internetnews.com. "Last year we signed a $150 million deal for calendar year '03 around this time."

The new order, to be filled from Agere factories and development hubs in Orlando, Fla., Singapore and Germany, runs through year's end. The companies won't specify how many phones will be produced, except to term it a "multi-million unit" agreement.

The deal announced Monday with South Korea's Samsung includes chipsets and software based on General Packet Radio Service and Enhanced Data Rates for GSM Evolution technologies.

GPRS phones follow the Global System for Mobile (GSM) communications standard, used in nearly 70 percent of wireless phones. GPRS enabled widespread adoption of high-speed data applications and services, like real-time audio and video streaming, photo imaging, MP3 music capabilities, MPEG4 video playback and games.

As a GPRS upgrade, EDGE will pave the way for new services., Agere said. Using the widespread GPRS network to quickly provide higher-speed data services, carriers are installing EDGE infrastructure over existing systems to add capacity.

Agere, which competes with Texas Instruments and others, said revenues from this agreement were included in the company's recent 2004 financial guidance.

In its most recent quarter, Agere trimmed its losses as sales of chips for mobile phones, hard disk drives and other personal computing products picked up.

In addition to Samsung, Agere, which spun off of Lucent in 2001, counts Apple , Cisco and SeaGate among its customers.