International Business Machines Corp, the world's largest computer maker, won a multi-year order from Analog Devices Inc to build chips for medical-imaging equipment, beating Taiwan Semicon-ductor Manufacturing Co (TSMC, 台積電).
The chips will be produced at IBM's plant in Burlington, Vermont, IBM spokesman Scott Sykes said. Terms of the agreement weren't disclosed. Sykes and Analog Devices spokeswoman Maria Tagliaferro said TSMC lost the contract.
The contract could be worth "hundreds of millions of dollars," said Tony Massimini, chief of technology at market-researcher Semico Research Corp.
IBM beat TSMC three months ago for a contract to supply graphics chips for Nvidia Corp. IBM and other manufacturers are getting more work because some chipmakers want to avoid investing in factories, which can cost US$1 billion or more, analysts have said.
TSMC decided in conjunction with Analog Devices not to compete for the contract, said Chuck Byers, a company spokesman. He said Analog Devices wanted services that the company couldn't provide.
IBM has unique equipment for manufacturing computer-memory chips, said Tagliaferro, spokeswoman for Massachusetts-based Analog Devices. The company will begin shipping the digital signal processor by the middle of next year, she said.
DSP chips are used in cellphones and handheld organizers to convert sound and light into electronic signals.
Analog Devices designs and makes circuits used to process signals in devices that run computers, automobiles and planes.
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