Samsung Electronics may supply NAND chips to Sony

Samsung Electronics may supply NAND chips to Sony

	Published : Mon, 26 Dec 2005 14:05 By : James Rowe Print this Story

SEOUL: South Korean electronics giant Samsung Electronics Co. Ltd. revealed that it may sign an agreement with Japanese company Sony Corporation to sell NAND flash memory chips to the latter.

Samsung Electronics, in a statement to the Korea Stock Exchange, said it is considering signing contracts to supply the NAND flash chips to major companies, including Sony. But nothing in detail has been decided, it added.

The regulatory filing came in response to a report in a Korean newspaper a few days back quoting a Samsung Electronics executive saying the company's NAND flash chips will be used by Sony in its MP3 players, which are set to hit the market soon. The unnamed official was also quoted as saying the company is all set to sign a contract in the first half of 2006 and the orders from Sony will exceed that from Apple Computer Inc., to which it is supplying NAND chips for use in iPods.

NAND memory chips have extensive applications in electronic industry, especially in the entertainment electronics because they have property to retain data even when the power is shut off. They are mostly used in music players, digital cameras and mobile phones.

Apple Computer is Samsung Electronics' first customer for NAND flash memory chips. A contract signed between the two companies ensures supply of NAND flash memory chips through 2010. Apple Computer has supply contracts with other chipmakers, Hynix Semiconductor Inc., Intel Corporation, Micron Technology Inc. and Toshiba Corporation.

A Sony spokesperson declined to comment on the report, but admitted that it depends on external suppliers for its NAND flash memory chips.

Samsung Electronics has a $2 billion joint venture with Sony Corporation for the manufacture of flat screens. The two companies are envisaging additional investment of around $85.89 million in this venture.

Meanwhile, Intel and Micron are planning to set up a joint venture with an initial investment of $1.2 billion each to make NAND chips.

According to trade group World Semiconductor Trade Statistics, NAND flash memory chip sales will register a 28 per cent growth reaching $13 billion in 2006.