X-bit labs

Sun Microsystems May Bid for Rambus – Rumours.

Category: Memory

by Anton Shilov

[ 09/12/2007 | 04:45 PM ]

According to many rumours posted on the Internet blogs and specialized forums after spreading among analysts and traders, Sun Microsystems may be close to making a bid to acquire Rambus, a developer of memory and chip interconnection technologies. The take over will have no impact on Sun’s business in the short term, but may have an impact on the industry.

Rambus develops various dynamic random access memory (DRAM) as well as chip interconnection technologies and licenses them to interested parties. For example, Sony PlayStation 2 and PlayStation 3 game consoles use DRAM memory types created by Rambus, while Cell processors developed by IBM, Sony and Toshiba relies on FlexIO processor system bus created by Rambus.

In addition, Rambus claims it owns patents on key-technologies used in modern DRAM that is deployed in every single computer sold. The company is trying to force all makers of computer memory to pay royalties to Rambus for every single SDRAM, DDR SDRAM and DDR2 SDRAM chip sold. However, DRAM makers believe that Rambus obtained the patents by deceiving JEDEC organization. Currently antitrust organizations in the European Union and United States are investigating Rambus’ ways to obtain the crucial patents.

If Sun acquires Rambus, it will not only automatically obtain its patents on various innovative technologies, including high-speed processor and memory busses, but will also inherit engineers as well as ongoing projects. However, given that Sun does not produce high-volume products, it could be cheaper for the company to license technologies from Rambus rather than to acquire the whole company. Moreover, Sun has been trying to make its servers and processors less proprietary in the recent years and it is not completely clear how the acquisition can influence such strategy. But if Sun makes technologies developed by Rambus available to those interested on different conditions compared to current, the company may gain a lot of influence.

At press time market capitalization of Rambus was $1.72 billion, whereas market capitalization of Sun Microsystems stood at $20.02 billion. The server and chip manufacturer also had $4.58 billion in cash.

Officials from Sun Microsystems and Rambus did not comment on the news-story.