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If Intel is extending its 845G family by introducing the 845GLL – a drastically cut down version of the chipset – it comes like a bolt out of the blue to most Taiwanese motherboard manufacturers.

A report on Digitimes earlier this week suggested that Intel would introduce the chipset to combat plunging prices and to compete with the myriad of manufacturers buzzing round the formerly lucrative market.

The GLL, the wire reported, will cost less than $25.

But motherboard makers The Inquirer talked to said they had not been notified of any such chipset.

One told The Inquirer: "We don't know anything about the GLL, and Intel hasn't told us anything. The roadmaps for the next year don't mention this chipset, even though Intel is already talking to us about [next year's] Springdale chipset."

That view was confirmed by another well known maker of motherboards who expressed surprise at the introduction, if it happens.

Intel had originally intended to launch the 845GL as a cut down or crippled version of the 845G chipset, but drew back after complaints from its partners.

News source: Intel's GLL chipset news to mobo makers

"We are fighting for market share, they are fighting for market share," Walter Raizner, general manager at IBM's storage products division, told reporters after the news conference.

"What we intend to do is to work together on common components for future systems and then leverage and utilize these components," Raizner said.

The companies said the venture in hard disk drives (HDDs), a key component in personal computers, servers and storage devices, had yet to be finalized and several details, such as when it would be set up and how much Hitachi would pay for IBM assets, were still unknown.

Hardball in Software

Hitachi will hold a hefty majority of the venture, but IBM will provide most of the employees -- 18,000 versus Hitachi's 6,000, as well as most of the business.

Shoyama also said IBM's HDD business was worth $3 billion to $3.8 billion (400 billion to 500 billion yen) a year, versus Hitachi's 100 billion yen.

Analysts have been pressuring IBM to sell its HDD business, which was hit hard by the IT slump and contributed to IBM's poor first-quarter earnings performance.

IBM's Raizner acknowledged the problems, but insisted the operations could be turned around.

"It's a very troubled business at the moment ... (but) I think the base business is very sound, the base technology we have is outstanding," he said. "We think this business will turn around with Hitachi or without Hitachi."

Shoyama also put a positive spin on the disk drive deal, arguing that the venture would have the scale and technology to be a global powerhouse and predicting HDDs would play a key role as storage devices for next-generation home electronics.

While Hitachi takes on the HDD business's burdens, it will also be able to tap IBM's expertise in storage system software -- one of the most promising areas for profits and growth in the increasingly competitive storage business, and one where EMC has a huge lead.

"IBM has excellent technology in developing software," Shoyama said. "We want to work on expanding our operations by integrating our technologies."

IBM's Raizner said Hitachi was likely to license his company's "virtualization" software, which will hit the market within six to 18 months and will let data-storage machines made by different companies talk to each other within a network.

Hitachi's sudden rise in the data storage world early last year had spurred an enthusiastic rally in its share price, cushioning it from the downdraft in Japanese chipmakers' shares as the semiconductor sector faced its worst downturn ever.

The market appeared unimpressed, however, by Wednesday's dual deals with IBM. Hitachi shares ended 0.63 percent higher at 958 yen, underperforming a 2.16 percent rise in the Tokyo Stock Exchange's electrical machinery index.

IBM shares had closed 85 cents, or one percent, higher at $86.20 in New York.