Rumor: Japanese Government Pushing For Elpida/Toshiba Memory Alliance

Brad Chacos

Even though all the focus is on hard drives and the aftermath of the Thailand floods, DRAM manufacturers have fallen on hard times, too. DRAM has never been cheaper, and while that’s good for me and you, it’s hard to run a business if you’re basically giving away the product. Japanese DRAM maker Elpida Memory may be learning that lesson the hard way right now; rumors say that the Japanese government is pushing hard for Elpida to join forces with Toshiba to try and keep the business afloat.

DigiTimes’ sources report that Elpida simply doesn’t have the cash to pay back its government loans. The Japanese government is getting involved because Elpida just so happens to be the last major DRAM manufacturer located in the country, and if it shuts down, Japan would be forced to rely on Korean sources for its memory supply.  (It probably wants some of its money back from Elpida, too, and closed businesses don’t make much cash.) The Japan-based Toshiba is a major flash memory supplier that hasn’t suffered from the DRAM downturn. Integration of the two companies would consolidate Japan’s memory-making capabilities, although the report says that Toshiba has no plans on entering the bottomed-out DRAM market whatsoever.

Neither company has commented on the rumor.

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