The Intel/Micron shotgun divorce

by Robin Harris on Wednesday, 14 March, 2018

One of the oddest marriages in high tech is coming to an end. Intel and Micron have announced that they are going their separate ways on 3D Xpoint.

They’ll still share their Utah fab – joint custody – but Intel will no longer subsidize Micron’s R&D, and Micron will stop selling some products at cost to Intel. My guess: the financial changes are a wash.

The StorageMojo take
The divorce isn’t surprising. The two companies – though chip vendors – have very different business models.

Companies hook up for all sorts of reasons, some sound, some less so. But the Intel/Micron relationship got off to a weirder than usual start, with a hurried press event.

I’ve never seen a good explanation for the rushed announcement. My best guess is that Intel intended to help Micron ward off a takeover attempt. Whatever the motivation, that sort of thing doesn’t happen without top execs signing off, so whatever panicked them then is no longer a concern.

One reason for the diverging paths may be technical. Intel wants to sell 3D Xpoint storage – which is block based – and Micron wants to sell 3D Xpoint memory, which is byte addressable. That difference affects yields as well as marketing, since Intel wants to tie 3D Xpoint to its CPUs, and Micron wants as broad a memory market as possible.

All in all, the divorce is a Good Thing. It’s always better in the long run – and often in the short run – when companies deal with each other at arm’s length, pay reasonable prices, and control their own roadmaps.

While 3D Xpoint isn’t going to be the winner that Intel and Micron hoped, the hasty announcement helped break trail for other NVMs with better specs and, eventually, economics.

Courteous comments welcome, of course.

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