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Intel Announces Milestone: One Billion Flash Memory Chips

Business Wire, May 22, 2000

Business Editors/High-Tech Writers

SANTA CLARA, Calif.--(BUSINESS WIRE)--May 22, 2000

Company to Expand Manufacturing to Produce Next Billion

in Two Years in Support of Wireless Communication

and Mobile Consumer Electronics Boom

Intel Corporation announced that it today sold its one billionth flash memory chip, a milestone that underscores the pivotal role that flash memory plays in the booming wireless communication and mobile consumer electronics market segments.

Intel introduced the first flash memory in 1988 with the goal of enabling new products that could benefit from the technology's unique characteristics: Flash memory chips preserve information when a device is powered off, providing a small, rugged, mobile and low-power digital alternative to disk drives, magnetic tape and film.

Today, flash memories are found in thousands of common products including mobile phones, MP3 music players, hand-held PC organizers, hand-held voice recorders and tape-less answering machines, in addition to such industrial products as network routers and cockpit voice recorders.

"One billion units is a lot of anything in this industry," said Ron Smith, vice president and general manager of Intel's Wireless Communications and Computing Group. "Mobile phones are the predominant demand driver for flash today, but people will find flash in unusual places like heart monitors, video arcade games, antilock braking systems -- even bird callers and fish finders."

Intel's records chronicle more than 100 different application categories for its flash memories, which started with a 256 Kbit (1/32 Mbyte) chip that Hewlett-Packard designed into a hospital bedside-monitoring device in 1988. This first chip cost about $20 each, or $640 per megabyte of memory. Today, Intel ships 128 Mbit (16 Mbyte) flash memories costing only $1.63 per Mbyte. Intel's StrataFlash(TM) technology allows each memory transistor to store multiple bits of data.

Supplying the Booming Wireless Communications Industry

The number of cellular phone subscribers has grown from about 200 million in 1997 to an estimated 600 million this year, moving to one billion in the next several years. Approximately 45 percent of Intel's first billion flash memory chips were sold to the cellular device makers, an industry that has helped make Intel the world's leading supplier of flash memory. Intel estimates that 66 percent of the second billion flash chips is likely to go to this market segment.

As a result of cellular industry growth, flash memory supply is tight around the world. Intel plans to increase its flash memory manufacturing capacity to help keep pace with the growth of the cellular market and other high-volume applications.

"Intel plans to ship the next billion units in only two years to keep up with the enormous demand," Smith said. "We are investing billions of dollars in our factory capacity, notably by transitioning from 0.25-micron technology to 0.18-micron production, which enables us to produce more chips on each wafer."

Intel introduced the first flash chips produced on 0.18-micron lithography in April 2000, enabling the company to nearly double the number of chips produced on each wafer. Intel is now producing its Advanced Boot Block flash memories on 0.18-micron technology in Santa Clara. By the end of 2000, Intel will also be producing 0.18-micron flash in existing facilities in Oregon and New Mexico, in addition to a dedicated flash facility in Colorado. Intel plans to produce four times as many flash megabytes in 2001 as in 1999.

Flash memory was the fastest-growing sector of the semiconductor memory segment in 1999, according to the Semiconductor Industry Association. Analysts believe flash memory may overtake SRAM memory this year to become the second largest semiconductor segment behind DRAM.

Intel, the world's largest chip maker, is also a leading manufacturer of computer, networking and communications products. Additional information about Intel is available at www.intel.com/pressroom.> Note to Editors: Third party marks and brands are property of their respective holders.