Micron Technology and Intel Corp have formed a new JV company that will be dedicated to providing NAND Flash IC's to Apple and others for fast growing NAND applications.
"The creation of this new company supports Intel's intent to maintain its industry-leading position in nonvolatile memory and enables us to rapidly enter a fast-growing portion of the flash market segment," said Paul Otellini, Intel president and CEO. "We are looking forward to working with Micron, and are extremely pleased to have Apple broaden its relationship with us."
The new company will be called IM Flash Technologies, LLC and have an initial "cash, notes and assets" injection of $2.4 billion US dollars. A further $2.8 billion US dollars could be injected into the company over the next 3 years, should it is being assumed the company becomes successful in the market place! Apple has been confirmed that it will pre-pay both companies $250 million US dollars each to secure NAND Flash supply, which will enable the new venture to ramp sufficient wafer levels to make an impact in the market, according to industry sources commenting on the news.
"This strategic relationship positions both Intel and Micron to build on each other's strengths to become leaders in the fast-growing NAND market segment," said Steve Appleton, Micron chairman, president and CEO. "This enhances Micron's competitive position as a leading supplier of advanced semiconductor solutions by ensuring we better serve our customers in the mobile communication and consumer electronics market segments."
Micron will have a 51 percent holding in the company with Intel owning the remaining 49 percent.
The NAND Flash will be fabricated using an advanced 72nm (SLC) process that will start production in early 2006, according to a press statement. A 50nm technology will then be used, though no timescales where given.
Manufacturing will be undertaken within Micron's existing US based facilities, which include its 300mm fab in Manassas, Virginia. Boise and Lehi fabs will also be utilized for the new Flash memory company.
The management team for the new company will be split between both companies, with Intel's Dave Baglee, past manager of Intel's Fab 11 in New Mexico, and Micron's Rod Morgan, who managed Micron's 300mm fab in Manassas.
Apple also announced the same day that it had entered into other multiple NAND Flash supplier agreements to secure supply for its iPod and related MP3 products due to the high demand from consumers, that will last in place through 2010.
"We want to be able to produce as many of our wildly popular iPods as the
market demands," said Steve Jobs, Apple's CEO.
Apple intends to pre-pay $1.25 billion US dollars over the next three months to Samsung, Hynix, Toshiba as well as Intel and Micron.
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