News

posted on 20 June 2008 09:30

A financial analyst has suggested Intel could offload its stake in the IM Flash Technologies joint venture with Micron to Seagate.

Intel's flash business has two facets. Numonyx is a joint venture with STMicroelectronics. This is not profitable and when it was announced earlier this year it was presented as way of Intel cutting its exposure to the flash market by offloading its NOR flash business to STM.

two year-old IM Flash Technologies is another joint venture, this one with Micron, of which Intel owns 49%. It has recently announced a new NAND flash process benchmark below 40nm.

Intel has made strong noises about being seriously ambitious in the flash SSD business but been relatively quiet about the IM Technologies end of the flash memory business, which builds chips for consumer electronics, removable storage, and hand-held communication devices. That flash market is unprofitable because of over-supply.

In February this year Intel boss Paul Otellini said, regarding his company's flash business: "We're going to fix it or make sure it's profitable one way or another."

If Numonyx is the NOR flash business 'fixed' then action remains to be taken with the unprofitable IM Flash Technologies.

Enter Seagate which is going to launch its own flash drives but has no flash foundry or relationship with a flash foundry owner. There have apparently been unsuccessful acquisition talks between Seagate and EMC SSD supplier STEC. So the Lazard Capital Markets analyst has suggested that Seagate could offer Intel a get-out route from IM Flash Technologies.

There is a question mark over Intel's true intentions here as stories of it exiting the flash business aren't consonant with its bullish messages concerning flash SSDs. Perhaps part of any deal would be a guaranteed SSD supply arrangement for Intel.

^{[Chris Mellor.]}