Elpida Inks DRAM Tech, Outsourcing Deal With Taiwan's ProMOS

Japanese DRAM maker Elpida Memory has signed a deal to provide advanced production line technology to Taiwan's ProMOS Technologies in return for memory chips, the companies said in a statement on Friday.

ProMOS will produce 1GB DDR3 (double data rate, third generation) DRAM chips for Elpida using the technology.

The deal between the two chip makers is important for the global PC industry because PC makers have recently complained about a shortage of DDR3 chips.

Gianfranco Lanci, CEO of Acer, the world's second-biggest PC vendor, said last week that Acer could have shipped more PCs in the third quarter had it been able to obtain enough components, including DDR3.

"In terms of pricing, the only thing we see going up today is memory and that's because of the move to DDR3," he said. DDR3 is quickly taking over the market from its predecessor, DDR2 (double data rate, second generation). DDR3 is speedier and more power efficient.

ProMOS will begin producing DDR3 chips for Elpida in the first half of 2010, with mass production to start in the second half of next year, the companies said.

The deal is also good for ProMOS. The Taiwanese chip maker was one of a few many believed was marked for consolidation under a government plan to restructure Taiwan's DRAM industry.

The agreement with Elpida will enable ProMOS to increase production after a lengthy period in which some of its factories sat idle due to the downturn, and "with the recent turnaround in the DRAM market, ProMOS has embarked on the road to recovery," ProMOS said in the statement.