Ericsson signs $1bn Compaq Alpha dev. deal

OK, it's for switches, but it's still a big thing for Alpha

Switches don't usually light The Register's candle, but we were intrigued when we learned the Compaq has won a major contract to supply Swedish comms company Ericsson with Alpha processors.

Ericsson plans to use the chips in its next-generation AXE wireless and wired phone switch. Both companies will co-operate on the development of the systems.

It marks the first time this desktop and server processor is being used in an embedded application, according to Terry Shannon of Shannon Knows Compaq.

The deal should bring between $500 million and $1 billion into Compaq's Alpha operation, each year over the next couple of years, reckons Shannon.

"The fact that switches have very long product lifecycles (say six or more years instead of two to three years as with a server) indicates Ericsson's confidence that Alpha will be around for a long time to come," he said. "Both the longevity factor and the incremental revenue are good news for Alpha." ®