Sharp making flash foray in North America

Electronic News, July 31, 1995 by Anthony Cataldo

After three years of being relegated to Japan, Sharp Corp. has quietly started supplying Intel-compatible flash memory parts and single-voltage devices to the robust North American market.

Since March, Sharp has been selling 8 and 16Mbit Intel-compatible NOR-type parts that read at 5-Volts and write at 12V, as well as 5V-only devices with the same densities, according to Brian Liddiard, Sharp Microelectronics IC marketing manager for North America. In August, Sharp also will begin sampling a 4Mbit single-voltage device that provides 3.3V reads to North American customers.

"This is definitely the largest market for flash," Mr. Liddiard said. "Our upper management is definitely committed to flash."

Until recently, Sharp kept its distance from the North American market during the course of its three-year-old technology and foundry pact with Intel. Mr. Liddiard said he did not know the details of the agreement with Intel, but sources suggested Sharp may have been precluded from selling flash parts in North America for a certain period.

Sharp's new flash foray came as no surprise to Intel. "This is exactly what we expected and planned for," said Bill Howe, VP and GM of Intel's Memory Components Division. "The entire semiconductor market is constrained at every level, and flash fits right into that. Flash has really established itself as a major memory market.

"(Sharp) will help grow the flash market and provide compliance for some of our products, so they will help," he added.

Though Sharp is providing an alternate source for the Intel parts, the two companies are not involved in a formal cooperative marketing agreement whereby they would refer customers to each other, Mr. Howe said.

So far, Sharp's effort to penetrate North America has been limited by a shortage of parts. Mr. Liddiard said the biggest demand is for the 4Mbit parts, though it is rapidly shifting to higher density 8 and 16Mbit devices. "The market is really tight," he said. "I'm getting a lot more request than I can handle."

Sharp is aiming to provide flash in several key market areas, including mobile phones, communications equipment and set-top boxes. Mr. Liddiard said it will take about a year until the company makes inroads as a major flash vendor in the U.S. "We're convinced we'll be a big player, but it won't happen overnight," he said.

Although Sharp is second-sourcing Intel's dual-voltage parts, Mr. Liddiard said the company has no immediate plans to sell Intel's SmartVoltage parts, which provide 3V/5V operation. Long-term, the market should convert to single-voltage parts, except for applications that need fast 12V write speeds, Mr. Liddiard said.

One analyst said Sharp could become a formidable force in flash owing to its strength in non-volatile memories. "Sharp is the world's leader in non-volatile memory," said Ron Bohn, senior analyst at Dataquest, San Jose, Calif. "Sharp clearly has the capability in the long-term to emerge as one of the toptier suppliers of flash."

Sharp is the world's largest supplier of mask ROMs, a non-volatile memory technology that is heavily dependent on the waning cartridge game industry (EN, July 17). Sharp may be turning to flash memory as a way to buffer against a flattening mask ROM market as the games industry converts to CD-ROM titles.

Sharp has steadily been ramping up its flash production at its Fukuyama plant in Hiroshima, Japan since the beginning of 1995 for its own internal consumption, such as hand-held systems, as well as supplying Intel-compatible parts, Mr. Bohn said.

With flash market growth surging at a rate of 35 percent in 1995, Sharp now has one of the best opportunities to jump into the flash arena. Worldwide, the flash market is expected to grow from just under $1 billion in 1994 to $1.3 billion this year. "I think that this year's shortfall of flash creates a new opportunity for new flash suppliers," Mr. Bohn said.

"If anything it's hurting Intel because they can't use that silicon for their customers," AMD's Kurt Wolf said. "It's just taking away capacity that Intel would have had today."

Intel manufactures its flash at its 0.6-micron Fab 7 facility in Rio Rancho, New Mexico in addition to the Sharp Fukuyama plant, which is adding new equipment to boost production. Half the plant remains empty, though Mr. Howe declined to say whether Sharp and Intel plan to use it for additional flash capacity.