The contenders in the high stakes game: Elpida Memory Inc. and Micron Technology Inc. At this stage, Japan's Elpida has the edge, leaving Micron on the outside looking in.

Micron says it is still in the game, as the company claims to offer a better deal and technology for the island's sagging DRAM makers. Maybe both Elpida and Micron will gain control.

It still remains to be seen, but expect a bitter fight for control of Taiwan's DRAM industry. Taiwan's DRAM houses are relatively small, but as a whole, they represent a significant share of the pie.

As reported, Taiwan will consolidate all of its DRAM makers and form a new company, dubbed Taiwan Memory Co., according to reports. Taiwan's DRAM makers include Nanya Technology, Inotera, Powerchip, Rexchip, ProMOS and Winbond.

The Taiwan government will pour $2 billion in the venture, but it will own less than 50 percent of Taiwan Memory, according to reports. The entity will form a partnership with ''either'' Elpida or Micron and not both, according to reports.

Some say Elpida has the upper hand. ''The technology leader has yet to be announced,'' said Daniel Amir, an analyst with Lazard Capital Markets, in a report.

According to DigiTimes, Taiwan Memory will use Taiwan's Rexchip Electronics Corp. as its base for volume production. Rexchip was established in 2006, as 300-mm manufacturing joint venture between Taiwan's Powerchip Semiconductor Corp. and Japan's Elpida.

Then, Taiwan Memory will acquire the respective 300-mm memory fabs from ProMOS Technologies Inc. and Winbond Electronics Corp., according to the report.

The report did not say what would happen to Nanya Technology Corp. Taiwan DRAM house Nanya has a fab and also has a joint memory venture with Micron, dubbed Inotera Memories Inc.

It's unclear how the Taiwan government will lure Nanya to join Taiwan Memory without a fight from Micron. If Nanya moves to Taiwan Memory, Micron may demand compensation.

This leaves some to believe that Taiwan will end up having two DRAM entities. One will be controlled by Elpida and another by Micron.

Others say it will come down to one vendor. ''Micron or Elpida will emerge as a leader within the next three months. Taiwan continues to negotiate with both Elpida and Micron on which company's technology will be adopted for Taiwan Memory Co. The government hopes to come to a decision within three months as part of its plans to roll out the new company in half a year,'' Amir said.

By: DocMemory
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