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NEC To Double 16-Megabit DRAM Production

February 16, 1996

TOKYO (AP) _ NEC Corp. said Friday it plans to double its output of 16-megabit dynamic random-access memories (DRAM) chips _ a key component in personal computers _ to 18 million units per month.

The increase will be carried out by the end of 1995, spokesman Makoto Miyakawa said, adding that NEC expects to raise production to 20 million units by the close of next fiscal year, which ends March 31, 1997.

Miyakawa said NEC converted production at its plant in Roseville, Calif., to 16-megabit DRAMs from 4-megabit DRAMs at the end of 1995, but wouldn’t provide any output figures.

The production increase may put NEC in a position to challenge Samsung Electronics Co. of South Korea, currently the world’s largest maker of 16-megabit DRAMS.

``NEC is indicating, in effect, that it’s going to be very aggressive in the 16-megabit area, and that’s going to make people worry about putting up the money for some projects that are already planned,″ Alan Bell, senior analyst at Schroder Securities (Japan) Ltd. said.

Prices of 4-megabit DRAMs have been falling amid oversupply, and many chip producers are scrambling to catch the next technological cycle. Analysts say the 16-megabit cycle is likely to last between 10 and 12 years, but with makers already developing 64-megabit DRAMs there are no guarantees about how long the cycle will last.

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