IBM and TDK are to work together on developing higher-capacity, more compact magnetic RAM (MRAM) chips.

The two companies will study how to use "spin momentum transfer" to make the cells that store data smaller. This could enable the production of smaller chips with higher capacity, necessary if the technology is to achieve more widespread adoption.

Magnetic RAM, or magnetoresistive RAM to give it its full name, uses tiny magnetic fields rather than electrical charges to store data. It is a non-volatile memory, meaning that like flash memory it retains data without the need for electrical power.

MRAM can be written to faster than flash memory, at speeds comparable to the dynamic RAM used in PCs to hold active programs and data, according to Freescale Semiconductor, the first manufacturer to sell the technology.

One potential market for MRAM is for computers that can be turned on instantly, without the need to load software into memory each time on start up. However, the MRAM chips currently on the market have capacities of only a few megabits, adequate for embedded control systems but not enough for modern PCs.

TDK and IBM hope that increases in capacity will make MRAM more attractive to cell phone and handheld computer manufacturers.

In the past, IBM has collaborated with Infineon Technologies on MRAM technology. Freescale started commercially producing 4Mbit MRAM chips in July 2006.