NatSemi-Cyrix deal casts shadow over IBM

Cyrix has no chip fabrication facility of its own and has recently relied on IBM Microelectronics to manufacture most of its parts. In return, IBM is able to sell Cyrix-designed CPUs under its own name.

That tight bond is called into doubt by NatSemi's greater strength. Although by no means approaching the size of Intel, NatSemi can boast annual revenues of $2 billion and a staff of 12,500 and may wish to bring chip manufacturing in-house. The firm already has a state-of-the-art 0.25-micron process.

The news that Cyrix is to be acquired came as a surprise to those involved in the IBM CPU world; IBM's press conference to announce shipping of the 6x86MX only took place last week. However, the current manufacturing contract still has 18 months left to run.

"It's an absolute surprise. All your questions are the ones we're asking ourselves," said Mark Jenkins, technical marketing manager for Blue Micro, the authorised OEM products representative for IBM. "We're seeking some comments from the [IBM] organisation. IBM has had a very long contract with Cyrix and there is more to run before the contract is complete."

Jenkins said he was uncertain whether NatSemi would be the right manufacturing partner for Cyrix. "NatSemi is a powerful organisation but they're powerful in linear business with telecomms and I/O, but not necessarily in desktop CPUs. The relationship between Cyrix and NatSemi is very, very tight [but] we're all hoping this is a kick in the ribs for Intel."