Advanced Micro Devices is the only other memory maker that has publicly announced a similar deal with Z-RAM developer Innovative Silicon. Rick Gaan, director of marketing at Innovative Silicon, said the company was in discussion with the other major memory makers.

Korea-based Hynix said it has received the first-mover opportunity to use Z-RAM in dynamic random access memory (DRAM) chips. Hynix did not disclose when it plans to release product, but Gaan said, Typically for technologies of this type we can expect to see something on the back end of the pipe in three years approximately.

DRAM, of course, is the most common type of computer memory, which is used to temporarily store information while a computer is in use. It prevents systems delays that occur when data is retrieved from the hard drive every time it’s needed.

DRAM requires a transistor and a capacitor to store electrical charge. Z-RAM, however, does away with the need for a separate capacitor by exploiting what is known as the floating-body effect, which enables the transistor’s charge to built-in.

Z-RAM works on silicon-on-insulator (SOI) technology, which allows for each transistor in the array to be electrically isolated, Gaan said.

To the end user, Z-RAM promises to keep PC costs down. For the past decade or so, the number of memory bits per dollar has increased about 27% a year. But Gaan said that rate is now slowing as memory makers struggle with manufacturing chips in smaller geometries, notably the 45-nanometer and 32-nm chip-making nodes.

If that bits-per-dollar rate slows to 19% per annual, the retail price of a PC increases a couple of hundred dollars over 10 years, according to Gaan. If it goes down to 13%, PCs will cost $750 more in the next decade, he said. Z-RAM gets rid of the problem because we don’t have a capacitor, he said.

Gaan said Z-RAM promises memory that is half the size of DRAM and significantly less expensive. But the real benefit is it promises to scale to smaller [chip-making] nodes, he said.

AMD first licensed Z-RAM from Lausanne, Switzerland-based Innovative Silicon in December 2005 for upcoming microprocessors. In December, it licensed generation 2 Z-RAM, which essentially enables faster memory and higher yields. AMD has not yet announced any Z-RAM products.