Samsung Could Cut IP Ties With SanDisk

Meanwhile, some of SanDisk's key patents that won it the injunction in 1997 are getting long in the tooth.

According to a search of U.S. Patent and Trademark Office records, one of SanDisk's fundamental patents was granted in 1992, which means it should become part of the public domain in 2009, when its 17-year exclusivity period expires. Other patents of SanDisk's may be covered by the PTO's subsequent policy extending exclusivity to a 20-year period, but those patents might still prove too old to last through the duration of the next seven-year licensing pact between the two companies.

Of course, the real value of the next licensing deal will revolve around fresher patents, involving technology for storing 3-bits of data per cell and 4-bits of data per cell on a flash memory chip.

Here, SanDisk has once again taken the lead and collected much of the relevant intellectual property. Earlier this year, SanDisk began producing 3-bit per cell flash chips, which it refers to as X3 technology.

Chips that store 3-bits of data per cell, as opposed to the 2-bits or a single-bit of data storage found in most versions of flash memory today, allow a producer to significantly lower the cost per bit of manufacturing flash memory chips - a huge advantage in a market in which having the lowest cost can mean the difference between a profitable enterprise and a money-losing operation.

SanDisk is also hard at work developing a version of flash memory that stores 4-bits per cell, through its $1.5 billion acquisition of Israel's M-Systems in 2006.