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Thu, Jul 26, 2007 - Page 10 News List

Toshiba mulls alliance with chipmakers

ALLIED GIANTS The Japanese electronics maker has also formed a joint project with IBM and Sony and has joined hands with NEC to develop 45-nanometer processing

AP , TOKYO

Toshiba Corp said yesterday it is considering an alliance with other Japanese semiconductor makers, including NEC and Fujitsu, to develop and produce next-generation, ultra-small consumer electronics chips.

But Toshiba spokeswoman Kaori Hiraki denied a newspaper report that the company had already reached agreement with NEC Electronics Corp and Fujitsu Ltd on the joint production of new chips smaller than 32 nanometers -- or 32 billionths a meter.

Fujitsu and NEC Electronics also denied the report an agreement had been reached.

The Nikkei Shimbun reported yesterday that the three companies have reached an agreement to jointly develop large-scale integrated, or LSI, chips for use in flat-panel TVs and other digital electronic appliances.

"We are still studying various possibilities," Hiraki said. "We have not decided anything concrete."

Fujitsu also acknowledged it is having negotiations with various companies, including Toshiba and NEC Electronics, "as part of a global trend involving the 32-nanometer chips."

"What to do with the next generation chip is actually a major interest across the industry," Fujitsu spokesman Hiroshi Tsuda said. He denied any accord had been reached.

NEC Electronics likewise said it is considering steps on the advanced chips and denied the reported agreement.

Japanese chip makers are at the forefront of the development of ultra-fine chip processing technology, but they have been losing out to foreign rivals such as Intel Corp and Samsung Electronics Co.

An alliance would help the companies save huge development and production costs and stay competitive globally, the Nikkei said.

Toshiba has formed a separate joint project with IBM Corp and Sony Corp, and has joined hands with NEC Electronics to develop 45-nanometer processing technology.

The Nikkei said the three companies are expected to form a team of engineers later this year to develop the new chip, aiming to start mass production in about two years.

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