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Intel, Rambus work to lower memory costs

Rambus' biggest ally, Intel, announces a consortium to help lower the price tag and boost adoption of the next-generation Rambus memory technology.

PALM SPRINGS, California--Rambus and Intel today announced a cooperative consortium designed to bring the cost of Rambus memory down, although price and other issues continue to hang like a cloud over the technology.

The Direct RDRAM Implementers Forum, which will include Intel, Samsung, Micron, NEC, Rambus, and others, will work together to develop ways to make testing, packaging, and even manufacturing of Rambus-style memory Pat Gelsinger less expensive, said Pat Gelsinger, vice president and general manager of the desktop products group at Intel.

"The goal is to reduce that [the price difference between Rambus and standard memory] very significantly," he said here at the Intel Developers Forum. "We will be able to improve and accelerate cost reduction and accelerate the pace of Rambus technology."

Rambus-style memory promises to improve overall PC performance because it will be able to transfer data more rapidly to the processor. Technical and financial issues, however, have delayed the release of Rambus-based memory and PCs thus far. Price declines and speed improvements in mainstream memory also have made Rambus less attractive to PC makers.

Rambus costs can be reduced in a number of areas, including shrinking the size of the memory and coming up with less expensive packaging, forum members said. One cost that won't be changed, however, is royalties. Rambus chief executive Geoff Tate said that the company has no plans to reduce the fee it charges memory makers for licensing its memory design.

Supporters say the existence of the forum is a step in the right direction. Jay Bell, a senior fellow at Dell Computer, for instance, said that about 35 to 40 percent of the company's desktops in the fourth quarter will use Rambus memory. That's down slightly from earlier projections of a 50 percent saturation, but robust nonetheless.

Most Rambus PCs, Bell added, will come out in the consumer Dimension line or in the workstation Precision line. A June delay of Intel chips supporting Rambus means that corporate buyers will not be able to effectively validate the technology for their systems for 1999.

A price premium for Rambus systems will exist, Bell added, but will go down rapidly.

Still, cost issues abound. Samsung, the largest manufacturer of Rambus memory right now, states that a price delta of 25 percent will exist between Rambus memory and standard memory by the end of next year if the company can manage to hit its manufacturing targets, according to Avo Kanadjian, senior vice president of Samsung. That is still relatively high, according to analysts.

As a result, Rambus will mostly still be confined to the high end of the PC market, occupying about 30 percent of ut. Next year, the dominant memory will still likely be standard SDRAM.

Compatibility concerns also exist. Although all the biggest memory manufacturers license Rambus intellectual property, the chips that result are not identical or interchangeable.

"We think there will be some initial compatibility issues," Kanadjian said. Samsung, in fact, does not yet sell Rambus memory chips separately. It sells Rambus only in complete memory modules to avoid compatibility problems.

Dell's Bell concurred, and added that PC makers will mostly buy their Rambus memory from single sources, which can keep prices high. Dell, for example, buys only from Samsung.

Initially, Samsung charged Dell $360 for a 128 MB memory module. More recently, the company dropped the price to $275.