Monday, March 31, 2008

Numonyx Born #1

Intel and STMicroelectronics today announced the official launch of their JV, Numonyx. Numonyx combines the NOR flash assets of Intel and NAND and NOR assets of ST under one roof.

Numonyx starts out its first day as the number one NOR flash vendor, overtaking Spansion. Now, like Spansion and other NOR flash vendors, it must find a way to make money. It’s not going to be easy with the economy in bad shape and NOR flash pricing affected by falling NAND flash prices. The new company, does however, have a few things going for it.

1. By merging two similar businesses, there’s a lot of low hanging fruit and
opportunities to cut costs.

2. Numonyx will have dedicated facilities for production unlike in the past when it had to compete for resources with chipset or logic products.

3. Numonyx is 1.5 years and 2 years ahead of Spansion and Samsung on the technology roadmap.

4. At Intel and ST, flash memory was a side business. At Numonyx, flash memory is a core business.

This last point is what makes Numonyx a formidable competitor. It must succeed just to survive.

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