英特尔和美光的蜜月期将很快结束，分手在所难免

• 英特尔和美光成立了一个合资公司IMFT，却不知道他们可能需要超过10年的时间才能建立起真正有竞争力的3D NAND业务；
• 在开发出成本破坏性的存储产品后，英特尔可能收回其在IMFT公司49%权益的剩余部分；
• 意味着英特尔可能不再是存储领域的玩家了；
• 美光近期和Seagate达成合作伙伴关系，以及Mark Durcan对美光和英特尔合作关系的模棱两可的评论加深了我的怀疑，这两个小伙伴很可能要分道扬镳了。

• Intel formed a joint venture with Micron not knowing that it might take more than 10 years to build a truly competitive 3D NAND business.
• After having developed cost disruptive memory, Intel may be called on the remainder of its 49% interest in IMFT.
• Therefore, Intel might not be a storage player for much longer.
• Micron's recent partnership with Seagate and the vague commentary by Mark Durcan on the Intel partnership further substantiates my suspicion that Intel and Micron will go separate ways.

I don't know how to say this as constructively as possible without sounding alarmist in front of my readers. But, basically, Intel (NASDAQ:INTC) and Micron (NASDAQ:MU) have this partnership in NAND flash, and there's a buyout clause for this partnership that may favor Micron overwhelmingly. Of course, there's no telling if Micron will actually exercise the call that will start in 2018. But, based on the language, a call would imply that they have the right but not the obligation to buy back the remainder of the IMFT partnership interest in which they own 51% of.

Intel has performed poorly in light of Micron's weak quarter and upside from that joint venture is being capped.

Some of the contributors on Seeking Alpha got into the gory details about how 3D NAND flash had immense upside potential and why Intel's consumer CPU business has a supplementary sidekick in flash memory. So, even if worst comes to worst, and Intel is unable to generate ramping CPU volume, at least the ramp up in solid state storage devices would make up for the difference. Unfortunately, Intel had signed away its right to own the NAND business for much longer.

Quoted from the 2014 Micron Annual Report (page 80):

Since inception in 2006 through August 28, 2014, we have owned 51% of IMFT, a venture between Intel and us to manufacture NAND Flash memory products and certain emerging memory technologies for the exclusive use of the members. IMFT is governed by a Board of Managers and the number of managers appointed by each member to the board varies based on the members' respective ownership interests, which is based on cumulative contributions to IMFT. The IMFT joint venture agreement extends through 2024 and includes certain buy-sell rights with an Intel put right, commencing in January 2015, and our call right commencing in January 2018, pursuant to which Intel may elect to sell to us, or we may elect to purchase from Intel, Intel's interest in IMFT. If Intel elects to sell to us, we would set the closing date of the transaction within two years following such election and could elect to receive financing of the purchase price from Intel for one to two years from the closing date.

I guess the real kicker is the fact that Intel will give Micron the financing to buy back its interest in IMFT. So, instead of receiving a lump sum amount of cash, Intel will instead finance the sale of IMFT back to Micron if Micron elects to buy the remainder of its IMFT interest from 2018 onwards. Upon launching the 3D NAND (32-layers 3-bit per cell), the cost becomes disruptive. Therefore, the upside to investing into IMFT as a result of lower memory cost per GB is roughly when Micron will be able to take back a substantial ownership stake in IMFT. So that's a huge problem for Intel investors who were banking on this business partnership to be long-term accretive to earnings. There's the potential that Intel no longer owns IMFT following 2018. So a forced sale for what could have been a star business could become a problem for Intel shareholders.

On the most recent earnings conference call, an analyst asked about Intel's relationship with Micron. Here's what Mark Durcan (CEO of Micron) stated:

Now relative to Micron's and Intel's plans for production, there's not a whole lot I can say about that today, other than to say it continues to be a very close partnership. We continue to develop the 3D NAND technology together and we have existing long-term supply agreements with Intel to support planar NAND and we anticipate that we will build 3D NAND for them as well through an agreement out of Singapore. And that's probably all I can say, absent an agreement with Intel to share more information with you.

So at this point, we're not even sure if Micron and Intel will continue down this path as partners, and with Micron also forming a partnership with Seagate (NASDAQ:STX), it's entirely plausible that Micron will exercise its right to buy back the remaining ownership interest in IMFT. It will then go down a path where it supplies Seagate with flash memory products and develop NAND flash technology jointly with Seagate.

So, Intel might not be a memory supplier for much longer folks. Just have to break the bad news to you guys. However, they might create a new agreement with Intel. Just not sure if Intel will bite, and while storage is a promising area, I'm curious to see how much Micron will have to pay in order to gain back the IMFT business. At the current growth trajectory, Intel will get a big lump sum of cash between 2018 and 2020. So, it's not bad. But ideally, I would have wanted Intel to own IMFT past 2020.