Macronix president Miin Wu said a memorandum of understanding signed on Monday in San Jose, California opens the door to joint development of embedded flash memory technology and ``system-on-a-chip'' logic microchips for use in mobile computers and phones.

``With the joint partnership, Macronix has made one more giant step towards being a viable system-on-chip provider,'' Wu told Reuters by telephone.

Wu said the market trend was to pack multiple computing technologies or functions on a single chip to increase the usefulness of the products that such chips drive.

The most effective approach, he said, was to team up with partners.

``If you look at future demand, you need to have multiple technologies,'' he said. ``But each technology demands a lot of focus and manpower, so Macronix has been focusing onflash technology.''

Flash memory is extremely important for devices with limited power supplies -- such as mobile phones with their phone number directories and security codes -- because it can retain information even when the power is shut off.

By contrast, dynamic random-access memory, or DRAM, loses all data as soon as power is lost.

Wu said Macronix aimed to develop system-on-a-chip devices that combine flash memory, DRAM, data processing, logic, power management, and other functions all on a single chip.

Under the memorandum, Macronix and VLSI will try to make advances in what Wu called flash embedded memory technology at Macronix's factory at Hsinchu, Taiwan's technology centre.

They expect to finish development of first-generation technology by the end of 1998, Wu said.

Macronix, listed on Taiwan's stock exchange and with American Depositary Receipts listed on the US Nasdaq exchange, had 1997 net profits of T$1.9 billion on sales of T$10.3 billion.

VLSI develops and manufactures customand semi-custom integrated circuits for the wireless communications, networking, consumer digital entertainment and computing markets.