Intel has shipped the first 65nm NOR Flash memory chip with a 1Gb capacity. 

The chips are designed for mobile phones with multimedia capabilities such as photos, video and high-speed data connections. According to Intel, the 1Gb chips could enable 4-megapixel camera-phones.

"NOR Flash is really a code execution engine in the handset," Mark DeVoss, senior analyst for flash memory at research firm iSuppli, told vnunet.com. 

"Every time you add a new feature, like a music player or an Mpeg4 video decoder, you have to add code. Now you can have the same code space, but more data space, or more code and the same amount of data storage."

The chip, which is the first of Intel's M18 line of 65nm Flash chips, was first unveiled in April.

"This is not an unanticipated announcement, but it is something we have been waiting for in the industry," Celeste Crystal, senior research analyst at IDC, told vnunet.com. 

Although the analyst believes that the chips will be used initially in high-end phones, Crystal said that mid-level models could also take advantage of the 1Gb chips as the technology becomes more widespread.

IDC pointed out that mobile phone makers, particularly in Japan and Korea, have been stacking 512Mb NOR chips to obtain 1Gb of flash memory. The new chip enables the same effect on a single chip.

"The density of our 1Gb product provides nearly double the storage for multimedia files and enables ever-slimmer form-factor phones," said Darin Billerbeck, vice president and general manager at Intel's Flash products group.

The smaller chips also provide for better battery life, according to Intel.

Crystal said that Intel and fellow chipmaker STMicroelectronics have an agreement to make their new chips 'drop-in compatible' with their current 90nm models. This lets manufacturers integrate new chips from both companies much more easily. 

The analyst expects STMicroelectronics to introduce a similar NOR chip shortly.

Intel plans to release 512Mb, 256Mb, and 128Mb M18 flash memory chips sometime next year.