Feeds

SanDisk gets Samsung in X4 armlock

Give us more money you cheapskate

Top 5 reasons to deploy VMware with Tegile

A US court ruling makes SanDisk free to charge Samsung more licence fee cash for its industry-leading four-bits-per-cell Flash technology.

Flash memory chips are composed of cells, and the more bits a cell can support the higher the capacity of the Flash chip, and the lower its price per bit. The fastest Flash has one bit per cell (single-level cell or SLC). Slower but higher-capacity - and hence cheaper - multi-level cell (MLC) Flash uses two bits a cell, with three bits per cell (X3) coming and four bits per cell (X4) in development.

SanDisk made a nifty move in acquiring Msystems, an Israeli Flash company with X4 technology, in July 2006. At that time Samsung and Msystems had an agreement, dating from 2003, whereby Samsung could use the X4 technology in exchange for royalties and a supply of cheaper chips to Msystems. But the cheaper chips didn't come in sufficient numbers, and Msystems cancelled the agreement in April 2006, a couple of months before it was acquired by SanDisk.

Samsung appealed against this and a lengthy arbitration process started. During its latter stages Samsung mounted a bid for SanDisk which was rejected because, SanDisk said, it undervalued the company. A New York court has just decided that Msystems, aka SanDisk, was within its rights to cancel the December 2003 agreement because Samsung had indeed not met its supply commitments.

To complicate matters, SanDisk and Hynix signed a patent cross-licensing and joint venture agreement in March 2007, in which Hynix can use the X4 technology in exchange for licence fees and a supply of cheap X4 chips to SanDisk.

Why does it matter? The Flash market is in an over-supplied glut state, yet prices are still high enough to discourage purchases of the stuff for notebook, desktop and server use, and for bulk use in storage arrays, assuming that write endurance problems can be sorted.

Manufacturers reckon the key to price cuts is to increase cell capacity so you get two, three or four bits per cell for almost the same manufacturing cost. If any one manufacturer can increase capacity faster than others and so cut its prices, that means it can sell its chips cheap and make a profit.

SanDisk has the X4 technology needed for this and now Samsung hasn't got its mitts on it any more - but rival Hynix has. That puts up SanDisk's value. We can expect an increased Samsung bid to come for SanDisk in the next few days - or maybe the collapse of the bid. ®

Intelligent flash storage arrays

More from The Register

next story
All aboard the Poo Bus! Ding ding, route Number Two departing
Only another three days of pooing and I can have a ride!
Official: European members prefer to fondle Apple iPads
Only 7 of 50 parliamentarians plump for Samsung Galaxy S
Fujitsu CTO: We'll be 3D-printing tech execs in 15 years
Fleshy techie disses network neutrality, helmet-less motorcyclists
Space Commanders rebel as Elite:Dangerous kills offline mode
Frontier cops an epic kicking in its own forums ahead of December revival
Nexus 7 fandroids tell of salty taste after sucking on Google's Lollipop
Web giant looking into why version 5.0 of Android is crippling older slabs
Dragon Age Inquisition: Our chief weapons are...
Bioware's fantasy forces in fine fettle
prev story

Whitepapers

Choosing cloud Backup services
Demystify how you can address your data protection needs in your small- to medium-sized business and select the best online backup service to meet your needs.
Getting started with customer-focused identity management
Learn why identity is a fundamental requirement to digital growth, and how without it there is no way to identify and engage customers in a meaningful way.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Choosing a cloud hosting partner with confidence
Download Choosing a Cloud Hosting Provider with Confidence to learn more about cloud computing - the new opportunities and new security challenges.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.