Commentary: New Intel chipset shouldn't displace Rambus

See news story: Intel cuts prices for wide range of chips

By George Iwanyc, Gartner Analyst

Intel's release of the 815 chipset should not be particularly troublesome for Rambus.

PC original equipment manufacturers--as well as others supporting the PC industry--are already aware that the 815 chipset will not support Rambus and that it will support 133-MHz SDRAM (synchronous dynamic random-access memory).

Gartner anticipates that 133-MHz SDRAM will be the dominant interface through 2001, but Rambus RDRAM (dynamic random-access memory) or double data rate (DDR) SDRAM could displace it.

RDRAM would suffer a significant blow if an Intel chipset for desktop PCs supported DDR. An industry conference held on May 18 addressed the benefits of DDR, but Gartner believes the choice will ultimately come down to what Rambus and DDR cost users, not the various manufacturing and performance benefits of DDR or Rambus.

Gartner continues to forecast that Rambus will be the dominant interface by 2002. But Intel may reverse course and support DDR before then, because Intel will do what will help sell microprocessors--not enable a memory transition.

If Intel feels Rambus availability will endanger its plans for the second half of 2000, a move could be made. Intel has already incorporated 133-MHz SDRAM into its product planning, and that is a technology it had hoped to avoid. The same thing could happen with DDR.

The relative health of the DRAM industry is working against Rambus. Gartner believes a DRAM oversupply works in favor of Rambus while an undersupply hampers a transition.

When there is an oversupply, all DRAM manufacturers are interested in finding profitable niches that carry premiums.

Gartner believes the industry today is near a balanced DRAM market but forecasts a DRAM shortage in the second half of 2000. If that comes to pass, the balance of power shifts to DRAM manufacturers, and they should be motivated to manufacture the most profitable parts. That will likely not be Rambus, because it is still early in its life cycle and has not been optimized for manufacturing.

The key is how much confidence DRAM manufacturers have in Intel's arguments. It is no secret that DRAM manufacturers would like to avoid paying royalties to Rambus, but they will continue to do so if that is what the market demands. Nobody will know the answer until the second half of 2000.

Entire contents, Copyright © 2000 Gartner Group, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.