AMD Opens Up on Plans for Faster Flash Memory

Company officials discussed a high-performance extension to AMD's MirrorBit flash architecture. Due by 2006, the technology will aim to be a premium level of flash.

Advanced Micro Devices Inc. this week disclosed that it is working towards tying its own flash memories to data storage, while making the chips cheaper to manufacture.

In an analyst conference, AMD officials discussed a high-performance extension to its MirrorBit flash architecture. Due by 2006, the technology aims to be a premium level of flash that will escape the commodity pricing trends that have plagued the market.

Although AMD is primarily known as a microprocessor company, the company split its third-quarter revenue roughly equally between its flash and microprocessor businesses—$503 million in processor revenue compared to $424 million in flash sales. In July to spin off its flash business into FASL LLC, a joint venture with Fujitsu Ltd.

According to FASLs estimates, presented by Bertrand Cambou, executive vice president at AMD and CEO of FASL, the joint venture ships much of the NOR flash used in cellular phones. He said that seven out of ten handsets in China contain AMD-branded flash, adding that FASL ships nearly 500 million flash chips per quarter.

NOR flash can be accessed without the need for error checking, while the NAND flash format is less robust but cheaper to manufacture. Meanwhile, NAND memory reads and writes data much faster than NOR.

The NOR-type flash memory is used typically to store program code within cell phones. Most cell phones currently use approximately 100 Mbits of flash memory to store both program codes and data, such as a stored list of cell phone numbers and other addresses. For years, manufacturers such as rival Intel have tried to penetrate the NAND flash market, an incompatible flash technology used to store data in CompactFlash and other cards.

FASL sells two types of flash: the more traditional "Spansion" NOR flash, and "MirrorBit", an AMD-designed flash memory that stores twice as much data per flash cell.

Cambou argued that todays MirrorBit technology offers may of the advantages of NAND, which is traditionally cheaper to manufacture. By the end of 2004, he projected, the manufacturing cost of both types of flash will be roughly equal. "MirrorBit is a disruptive technology, with the cost of NAND and the quality of NOR," he said.

In the future, FASL hopes to penetrate the NAND market with a version of MirrorBit optimized for NAND memory. Called "NAND-on-MirrorBit," the technology is currently under development and could be commercialized by 2006, Cambou said.

In addition, AMD engineers are developing a 64-Mbit serial flash for the same timeframe, which would be optimized for high performance. AMD is also designing a more conventional 512-Mbit MirrorBit optimized for data storage that AMD hopes to ship during 2004.

FASL and AMD arent alone in the search for improved flash technology. In October, Intel disclosed a technology that will offer NAND-type functionality for NOR memory. Intels offerings will begin sampling this month, and enter production next February.

With the growth of consumer digital products, flash memory is almost ubiquitous. The growth in the market has caused flash prices to act like its cheaper cousin, DRAM. The falling flash prices prompted AMD to move its flash business to the FASL subsidiary, although, the profits and revenues of the flash business appear on AMDs balance sheet.

In the previous quarter, AMDs microprocessor business returned an operating profit of $19 million, while the companys flash unit lost $49 million, dragging AMDs net earnings down into the red.

During the fourth quarter, AMD expects its flash business to break even, said Hector Ruiz, AMDs president and chief executive.

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