Nokia signs up for Samsung's new cell phone DRAM

Samsung Electronics Co. Ltd., the world's largest memory maker, has developed a new type of DRAM (dynamic random access memory) for cellular telephone handsets and Nokia Corp., the world's largest cellular handset manufacturer, has signed a deal to become the first customer for the new chips.

The new chips do not require as high a voltage as conventional DRAM chips, making them more suitable for use in cell phone handsets, said James Chung, a spokesman for Samsung Electronics. DRAM chips are most commonly used as the main memory in personal computers. In portable devices like cell phones, however, power requirements are key in determining which type of components are used because less power means longer battery life.

"Cell phones currently use SRAM (static random access memory) but Nokia thought, in those (next generation) types of phone they will need more memory chips compared to (current telephones with) SRAM," said Chung. "So Nokia privately asked Samsung Electronics to develop DRAM chips suitable for handheld phones and we made them."

Samsung produced sample chips in July but will not reveal plans for mass production or manufacturing levels because such information would reveal Nokia's cell phone handset production levels, said Chung. He would not disclose terms of the deal.

Other companies will need to use such chips inside their handsets in the future although Samsung is not in talks with any other companies at present, he said.

The new chips could open up a new market for DRAM, which has been suffering as world prices have hit all-time lows. The spot price of standard 128M-bit DRAM chips in Asia on Wednesday was US$1.50, according to market data provider ICIS-LOR. That price is well below the $3.25 at which the same chips were trading 3 months ago and the $5.65 they were selling for at the end of 2000.

The slump has sent many memory makers into the red and manufacturers are scurrying to find ways to make money from DRAM. Samsung is concentrating on high-end chips and niche products, such as the cell phone DRAM, where there is less competition and so more price stability.

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Martyn Williams

PC World

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