Toshiba will likely delay the construction of a new memory chip plant in western Japan by half a year due to slow progress in land acquisition, the Nikkei business daily said, citing President Atsutoshi Nishida.

"The joint venture is evaluating plans for operations over the holiday season, including a possible stoppage of some production lines," a SanDisk spokesman said Friday. "We constantly consider manufacturing schedules in light of market requirements and this is particularly true during the holiday season," he added. This follows a Bloomberg report that said Toshiba is considering a "partial stoppage" of flash memory production in Japan over the holidays.

"The sector is in a dire situation," said Toshiba Senior Executive Vice President Masashi Muromachi. "Sales prices tumbled 40 percent or so in the first half and they are falling faster than expected in the second half." Muromachi also said that World Semiconductor Trade Statistics's revised forecast for 6.5% growth in global sales of semiconductors in 2010 was still high.

Hitachi Global Storage Technologies and Intel are teaming up to produce solid-state drives (SSDs) for servers and workstations, the companies said Tuesday. Under terms of the deal, drive maker Hitachi GST will only use NAND flash chips obtained from Intel in its high-end SSDs. The two companies will jointly develop drives that use Serial Attached SCSI and Fibre Channel interfaces, with products expected to hit the market in 2010, they said. Financial terms of the agreement were not disclosed.

Japan's Toshiba said it planned to increase its output of flash memory-based solid state drives (SSDs) 15-fold over the next two years, aiming to control half of the global market for the new memory devices.

Chip makers are shutting down less-productive factories, delaying investment projects and even cutting staff in a sign that the global economic slowdown and the credit crunch are taking a hefty toll on demand and hurting their operations. The coming few months could be critical for several memory-chip makers in Asia, Europe and the US as they continue to grapple with weak demand and a severe cash crunch amid plunging chip prices, which remain well below their manufacturing costs.

SanDisk has been hurt by falling prices for NAND memory chips, a type of flash memory the company makes for consumer gadgets like music players and digital cameras. But a Goldman Sachs analyst said key intellectual property rights associated with the chips give the SanDisk more value than the market has recognized.

SanDisk has released details of its new flash management technology, ExtremeFFS (Extreme Flash File System) which has the potential to extend endurance and accelerate SSD random write speeds by as much as 100 times compared with existing systems.

SanDisk said it is still "open" to a Samsung buyout offer and hinted at more restructuring to come, as the largest supplier of retail flash memory cards reported a third-quarter 2008 net loss of US$155 million on Monday. The loss was significantly worse than the net income of US$85 million reported in the third quarter of 2007. SanDisk and other flash memory chip suppliers have been hit by a steep price decline in flash.

SanDisk may have just concluded a multibillion-dollar patent licensing lawsuit with Samsung which could determine the future of both SanDisk and the flash industry at large. As SanDisk considers a US$5.8 billion takeover offer by the flash giant, private arbitration has given Sandisk rights to a technology that may well hold the future of flash memory.

The world's biggest flash memory chipmaker said it has recently begun shipping 16-gigabit multi-level cell (MLC) flash chips to clients using the 42nm level. Samsung's bigger Japanese rival Toshiba and Hynix Semiconductor are still using 43-nanometer and 48-nanometer technology, respectively.

"Yes, Samsung is still in (merger) talks with SanDisk," Kwon Oh-hyun, head of the company's semiconductor division told The Korea Times on the sidelines of a business forum held at the National Assembly. "Samsung's legal team has reviewed measures to calm down a possible anti-trust issue in the United States if the deal succeeds," Kwon said. U.S. financial regulators would most likely reject the proposed deal because it would create a near monopoly in the flash memory market, analysts say.