Programmable chip maker Altera Corp. (ALTR: Quote) agreed on Monday with giant chip maker Intel Corp. (INTC: Quote) to build its next-generation field programmable gate array or FPGA, products using Intel's 14 nanometers or nm, tri-gate transistor technology. Terms of the agreement were not disclosed.
San Jose, California-based Altera noted that products based on the 14 nm tri-gate transistor technology are used in ultra high-performance systems for military, wireline communications, cloud networking, and compute and storage applications.
A FPGA is an integrated circuit designed to be configured by a customer or a designer after manufacturing, thus making it field programmable.
"Altera's FPGAs using Intel 14 nm technology will enable customers to design with the most advanced, highest-performing FPGAs in the industry. In addition, Altera gains a tremendous competitive advantage at the high end in that we are the only major FPGA company with access to this technology," Chairman, President and CEO John Daane said in a statement.
The reported 12-year agreement with Intel will enable Altera to add next-generation product families based on the 14 nm technology to its portfolio. Altera is already engaged with Taiwan's Taiwan Semiconductor Manufacturing Co. Ltd. or TSMC (TSM: Quote) for developing 20 nm products based on TSMC's 20 nm next-generation system-on-a-chip (20SoC) process technology.
TSMC is and will remain Altera's primary foundry for the 28 nm and now 20 nm products, existing mainstream products, and long-lived legacy components, while Intel will now be Altera's foundry for 14 nm products, with Altera being Intel's exclusive FPGA customer on 14 nm technology.
The mixing and matching process technologies from multiple foundries in its next-generation portfolio will enable Altera to create the most-differentiated, highly optimized products in the industry and will help its customers to achieve a measureable advantage in their end application.
Altera, along with Xilinx, Inc. (XLNX), are the current FPGA market leaders and long-time industry rivals. Together, they control over 80 percent of the market. However, the use of Intel technology for Altera's 14 nm product families will give it about two to four year technology advantage over Xilinx.
Intel had announced in 2010 that it will use its foundries for contract manufacturing to make chips for other companies, but failed to rope in any large customers until now. Altera, which has relied on TSMC for the past 20 years, will now use Intel's technology that is a generation ahead of rivals in shrinking the size of transistors.
"We look forward to collaborating with Altera on manufacturing leading-edge FPGAs, leveraging Intel's leadership in process technology. Next-generation products from Altera require the highest performance and most power-efficient technology available, and Intel is well positioned to provide the most advanced offerings," Intel COO Brian Krzanich noted.
ALTR closed Monday's regular trading session at $35.01, down $0.34 or 0.96% on a volume of 4.81 million shares, and INTC closed at $20.23, down $0.19 or 0.93% on a volume of 41.53 million shares.
by RTT Staff Writer
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