LONDON — A joint venture between non-volatile memory company Numonyx BV and Korean memory giant Hynix Semiconductor Inc. holds the key to how quickly Numonyx can expand its production of NAND flash memory, according to Ed Doller, chief technology officer of Numonyx.

The joint venture, based in Wuxi, China, is a legacy brought to Numonyx (Rolle, Switzerland) by parent company STMicroelectronics NV. However, during 2007 while the creation of Numonyx was being negotiated between ST and its second parent, Intel Corp. the share in the joint venture dropped to 16.7 percent as ST halted investment in the JV but Hynix continued to invest in manufacturing lines. (see May 2007 story).

The joint venture, formerly known as Hynix-ST Semiconductor Ltd., has operated a 200-mm wafer fab making DRAMs for some time and recently brought up a 300-mm wafer fab making NAND flash memories. It is usual in such joint ventures that the ownership, governed by the amounts of capital invested also determines the proportion of the fabs output that the parent can claim.

"The majority of our revenue in 2008 will be NOR flash," said Doller but argued that Numonyx expects to compete in the NAND flash market in so far as it addresses the wireless world.

Doller said manufacturing would come from "the JV Numonyx has with Hynix. It is up to us to set the R&D budget to pay for equipment to increase capacity. But we have access to capacity on an excellent cost structure out of Wuxi,"

Doller did not indicate how much Numonyx would have to spend to raise capacity significantly, or where it could find the money. Hynix has invested at approximately $1 billion in the plant.

The NAND flash market is oversupplied at present, and this is leading to price weakness. And if a consumer spending recession hits the western hemisphere during 2008 this situation could be exacerbated.

However, Doller emphasized that Numonyx would not be in direct competition with many NAND flash makers and with IM Flash Technologies LLC in particular, the NAND joint-venture between Intel (Santa Clara, Calif.) and Micron Technology Inc. (Boise, Idaho). "We will be in competition but Intel is focusing its NAND business into the computing world. We [Numonyx] are focusing on the wireless world," he added.

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