Intel eyeing NAND Flash memory 15 April, 2007 By Liam Lahey

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The chipmaker is making significant investments in NAND to support its goal of becoming one of the top players in this business, officials said.

NAND is a nonvolatile solid-state memory. It has the capability to hold and store data even when the power is turned off. This feature makes NAND an excellent storage solution for many applications such as MP3 players, USB drives, removable storage cards, cell phones, and an endless number of other applications where mobility, power use, speed, and size are key factors.

NOR flash memory has traditionally been used to store relatively small amounts of executable code for embedded computing devices such as PDAs and cell phones. NOR is well suited to use for code storage because of its reliability, fast read operations, and random access capabilities. Because code can be directly executed in place, NOR is ideal for storing firmware, boot code, operating systems, and other data that changes infrequently.

"With NAND and NOR, Intel is participating in two businesses that are not closely aligned with its core strengths, and may spin these businesses out at a later date," said Jim McGregor, In-Stat analyst. "Although both the NAND and NOR businesses are expected to grow, In-Stat sees NAND as the higher-growth market, and believes that NOR's more moderate growth may not keep the interest of Intel's upper management."

Recent research by In-Stat also found Intel is investing to open one new 300mm NAND fab every year with its IMFT JV with Micron Technology. Intel is in a struggle for market leadership in NOR Flash against Spansion. This struggle is forcing other makers out of the market. And according to In-Stat's report, "Intel and Flash: Playing in both NAND and NOR," Intel and Spansion have been unprofitable for all of 2005 and 2006.

Meanwhile, Warren Shiau, associate partner, senior analyst, IT research, for The Strategic Counsel, said both the NAND and NOR markets would continue to thrive because each has a different strength and/or weakness that makes each suitable for varying applications.

"NAND flash memory has become the preferred format for storing larger quantities of data on devices such as USB Flash drives, digital cameras and MP3 players. Higher density, lower cost, and faster write and erase times, and a longer re-write life expectancy make NAND especially well suited for consumer media applications in which large files of sequential data need to be loaded into memory quickly and replaced with new files repeatedly," he said. "The choice between using NAND and NOR Flash may not be a simple one for the complex embedded devices being developed today.

"While ever-larger media files are driving increased demand for inexpensive NAND, powerful new operating systems and intricate applications running on fast processors call for the kind of fast-executing code NOR can support."

An important example is a smart phone or PDA that combines a tremendous need for storage with a demanding set of application performance requirements, Shiau said. In some cases an optimal design might call for both types of flash memory in the same device.

"Whichever type of flash is used in a device, there are certain negative performance characteristics that need to be mitigated. NOR is fast to read current data but markedly slower to erase it and write new data," he explained. "NAND is fast to erase and write, but slow to read non-sequential data through its serial interface. NAND is also prone to single-bit errors, requiring rigorous algorithms for error detection and correction."

Ultimately, the decision between NAND and NOR memory would depend on both technical and pricing requirements of the device being built, he continued. Whatever type or combination of flash is used, it is prudent to include memory management software to prevent data loss while improving the performance and maximizing the lifespan of the memory.

"I believe the implication of Intel moving into NAND is that it is a play to move into the consumer market, for instance, digital cameras and MP3 players," Shiau said. "The ultimate impact is Intel bringing manufacturing efficiency to bear, making NAND even more cost-effective. This is all about driving volume."

As for profitability levels in the NOR flash market, memory is highly cyclical, he noted. The key thing is who has the ability to withstand profitability troughs? Shiau said what's happening in NOR is a market share battle between Spansion and Intel: Spansion is probably hoping to reach high enough volume and allow it to be profitable even with big declines in NOR prices.

"According to the stats, Spansion did supplant Intel as the leading NOR vendor last quarter," he remarked. "The idea being, if you can't get good margins to make things up on volume."