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Intel , the world's largest chip maker has signed an aggreement with Taiwan Semiconductor Manufacturing to build its Atom processor.
The deal marks the first time Intel has handed over any chip manufacturing capability to a third party. TSMC will help make the Atom processor which is mostly used in mobile devices and smaller IT products.
Paul Otellini, Intel CEO said: "We believe this effort will make it easier for customers with significant design expertise to take advantage of the Intel architecture."
TSMC is the world's largest contact manufacturer of chips and Intel hopes to push Atom as the platform of choice into new markets and new devices.
Global chip sales were $15.3 billion in January, a fall of 29% according to figures from the Semiconductor Industry Association.