Toshiba, NEC, Fujitsu mull next-gen chip alliance

Japanese semiconductor makers Toshiba Corp., NEC Electronics Corp. and Fujitsu Ltd are looking to jointly develop ultrafine ICs for the CE market, the Associated Press reported.

Toshiba spokeswoman Kaori Hiraki said her company was thinking over the three-way pact. "We are still studying various possibilities... We have not decided anything," she said, belying earlier media reports alleging that an agreement has been sealed.

Fujitsu and NEC Electronics acknowledged that they were under negotiations with certain companies regarding 32nm technology but likewise denied reaching any accord on the advanced chips. "What to do with the next-generation chip is actually a major interest across the industry," Fujitsu spokesman Hiroshi Tsuda remarked.

The local Nikkei financial daily reported Wednesday that Toshiba, NEC Electronics and Fujitsu have reached a basic agreement to jointly develop 32nm chips to be embedded on flat-panel TVs and other digital electronics. The paper said that under the partnership, a group of engineering experts would be created to work on the development of the advanced system chip. Volume production is expected in two years, Nikkei added.

Such an alliance is seen to spur the three companies—dogged by rivals Intel Corp. and Samsung Electronics Co.—to stay competitive in the race towards creating ever-smaller chips.