Doug Bartholomew, Samuel Greengard, Glenn Hasek, John Jesitus, Scott Leibs, Kristin Ohlson, Robert Patton, Barb Schmitz, Tim Stevens, and John Teresko contributed to this article. Microprocessor leader Intel, which invented flash memory and at one point got out of the flash memory business, is now back -- with a vengeance. Early this fall, Intel generated headlines with the announcement that it would go into production with a technology that essentially allows the fabrication of flash memory chips with twice the storage capacity at little additional expense. The technology that makes this possible permits a single memory cell to store not one, but two bits of information. This approach was first demonstrated by Intel at the 1995 Solid State Circuits Conference, but it is only now ready for production. The breakthrough comes at a time when demand for flash chips is soaring -- as more products come to market depending on flash for nonvolatile data storage. For example, digital cameras make heavy demands on flash memory cards. Then too, there are a variety of products on the drawing board that must wait until flash prices are much lower. NEC Corp., Tokyo, demonstrated a flash memory-based shirt-pocket recorder several years ago and then followed up with what can only be described as a solid-state video Walkman. The shirt-pocket device could be pulled out at any free moment so its owner could enjoy a movie. The catch, of course, was that there was no available flash memory card with the capacity to store the recorded video. Such a development does not, of course, occur overnight. Work on StrataFlash, as Intel calls it, has been quietly moving forward for about four years. While Intel has been careful to avoid premature publicity, the project has not been kept from potential partners and developers. For example, Centennial Technologies Inc. will offer a 64-MB PCMCIA card, while Smart Modular Technologies Inc. will roll out a Miniature Card using 32 MB of StrataFlash memory. Early production next year, based on 0.4-micron technology, will be carried out at Intel's New Mexico fab, but by the second half, Intel plans to produce the chips to a 0.25-micron design rule in Israel. That fab is now being built. Rival SanDisk Corp. also has a double-density flash chip that it will soon offer in an 80-MB CompactFlash card. Although the two approaches are superficially similar, technically they are quite different. Intel doubles the amount of information in each memory cell. Conventional flash memory distinguishes between the 1s and 0s of computer language by sensing whether a cell has a charge or not, thereby recognizing two different states for a single bit of information per cell. Intel's new approach is to sense four different levels of voltage across each cell thus extracting -- or storing -- twice as much information. SanDisk's approach, which requires several different chips on a card, is reportedly more complex and potentially more expensive. Moreover, Intel is said to be working on a refinement that will allow the storage of three data bits per cell using essentially the same approach. Intel plans to price 64-Mbit devices at less than $30 when volume production first starts. That's less than what 16-Mbit flash devices sold for only a year ago. Bill Howe, who heads Intel's computer-enhancement group, believes that the lower price will open up a wide range of new applications. Howe, who was largely responsible for Intel's success in Japan when he was president of Intel Japan, predicts StrataFlash sales of between one million and 10 million chips in 1998. Dataquest projects worldwide sales of flash chips to soar next year to more than $3.4 billion for a 14.1% year-to-year gain. But don't look for StrataFlash to replace volatile DRAM chips for PCs. Even StrataFlash will remain far more expensive than DRAM and it falls short in the critical area of access time. For now at least, StrataFlash has another drawback when compared to other semiconductor memory approaches. To achieve double-density, Intel gave up read-write endurance -- the number of times data can be overwritten before errors start to appear. StrataFlash is rated at 10,000 cycles compared to 100,000 or better for conventional flash. That's more than enough, however, for the consumer electronics applications that represent the biggest market for flash memory.