Intel unveils cellphone memory to take on Samsung

Intel Corp, the world's largest maker of semiconductors, has created a faster version of its flash-memory chips for mobile phones that may help the company regain market share from Samsung Electronics Co.

The microchips write data into memory cells at more than three times the speed of previous models, Intel vice president Darin Billerbeck said in an interview on Thursday in San Francisco. Intel built the chip because of competition in an industry that is like being in a "dog fight with everyone," Billerbeck said.

Intel faces the challenge of convincing investors that it can take on South Korea's Samsung Electronics in making flash chips used to access picture and music files in mobile phones with built-in cameras and Web access. Intel surrendered its top spot for flash-memory chips to Samsung in 2003.

"Samsung is still too far ahead for Intel to be a concern," said Yang Jun Won, who owns Samsung Electronics shares amid the equivalent of US$400 million he manages at Macquarie-IMM Investment Management Co in Seoul.

Samsung had 28 percent of the flash memory market in the fourth quarter, with sales of US$1.01 billion, said El Segundo, California-based researcher iSuppli Corp. That represented a jump of 11 percent from the preceding quarter. Intel, the second-biggest in the market, had 16 percent, with US$643 million in sales, the research firm said.

Intel's new flash-memory chips can be attractive to phone makers because of the speedier access to information, Billerbeck said at the Intel Developer Forum. The chips will write at speeds of up to 500 kilobits a second, instead of 140 kilobits for older ones.

"Many newer-generation mobile phones not only are communicators, but also MP3 players, personal digital assistants, and digital still cameras," said Mark DeVoss, an analyst at iSuppli Corp.

Samsung, which makes a different kind of flash memory called NAND, is expected to benefit from a market that's expected to grow 26 percent from 2003 to 2008, more than twice as fast as the 10 percent gain in the type of chips that Intel makes, according to iSuppli.

"From an Intel perspective the question is, what are you doing about the whole of that US$17 billion market that might go to US$30 billion?" Billerbeck said. "We had a bad strategy."