Looking to take advantage of the growing demand for flash memory in cell phones, PDAs, and TV-top boxes, Intel Corp. says it's raising prices on the technology by as much as 40% beginning in January. Intel has seen several of its top original equipment manufacturers--including Motorola, NEC, and Samsung--double and even triple the flash-memory requirements for cell phones due to demand for picture-taking and color-screen features, says an Intel spokeswoman.

During the first quarter of 2003, Intel will ship its PXA261 and the PXA262 processors, which include flash memory, in a bid to create distance between itself and competitors AMD and Atmel. Although Intel says the price hike is a way to take advantage of strong demand for its products, one analyst wonders if Intel isn't opening the door for AMD and Atmel. Intel has been trying to get more of its technology into cell phones, but, says Fred Zeiber, president of Pathfinder Research, "when you raise prices, it's open season for your competitors."