IBM Announces Memory Chip Breakthrough : Technology: The company becomes the first to begin pilot production of a 16-million-bit computer chip.

International Business Machines on Tuesday became the world’s first company to announce pilot production of a 16-million-bit computer memory chip, a device with four times the capacity of today’s most advanced chips.

IBM, the world’s largest manufacturer and consumer of memory chips, said it would be at least 18 months to 24 months before this new generation of dynamic random access memory chips (DRAMs) would be included in its computers. IBM uses all the memory chips it produces in its own machines and does not sell any to other computer makers.

Analysts said that while other American and Japanese semiconductor manufacturers are developing similar DRAMs, IBM’s early announcement underscores its intention to publicize its technical accomplishments, particularly those coming at the expense of the Japanese.

“This demonstrates how much pressure IBM is under to show that its technical powers are still in place,” said Dan Hutchinson, president of VLSI Research, a San Jose semiconductor market research firm.

“The announcement answers the question of whether a Japanese company would actually beat IBM for the first time ever with a new generation DRAM,” Hutchinson said.

According to Hutchinson, IBM’s edge in developing new generations of memory chips has been steadily slipping since 1975, when it had a lead of about six years. Hutchinson estimated that IBM is currently about six to 12 months ahead of Toshiba, the leading Japanese chip maker, in developing the 16-megabit DRAM. A 16-million-bit memory chip can store the equivalent of about 1,600 pages of double-spaced, typewritten text.

IBM is currently shipping machines, ranging from top-of-the-line mainframes to desktop personal computers, equipped with 4-megabit DRAMs. These chips are also made by other semiconductor makers worldwide and will be the leading edge models until the 16-megabit devices, measuring about one-third inch by three-fourths inch, are in widespread use in about 18 months.

Last month, IBM announced that it had entered into a joint venture with Siemens AG of West Germany to develop a 64-million-bit chip, which would be the next generation of DRAMs after the 16-megabit model. Because of the way chips are constructed, advances usually take place in intervals of four times greater capacity than the previous generation.