At present, UMC is developing leading-edge process technology by itself. This is a costly effort--even for Intel.

UMC has a 45-/40-nm process, but can it do 32-nm and beyond? It can barely keep up with rival TSMC.

To help its efforts, UMC recently joined Sematech. But UMC is also looking to join IBM's technology platform alliance, sources said.

The group, which co-develops advanced process technology and shares the associated costs, consists of AMD, Chartered, IBM, Infineon, ST, Toshiba, NEC, Freescale and Sony. AMD's proposed foundry spin-off is also part of the group.

Several years ago, UMC, IBM and Infineon joined forces to develop processes. UMC dropped out after it could not work with Big Blue. Maybe the second time is a charm.

UMC declined to comment on the rumors. ''We can't comment on industry speculation,'' according to a UMC spokesman, ''but at our IR conference yeterday the press release had a quote from our CEO that had some redundant themes. Hopefully the quote can paint some color as to UMC's position on R&D.''

Here's what Shih-Wei Sun, CEO of UMC, said: ''Although it is difficult to predict upcoming industry conditions, UMC R&D for advanced technologies remains on schedule as originally planned. Many customers are adopting our 40/45-nm technologies with customer products currently in pilot production using low-power and high-performance logic processes. In addition, we have already proven high-k/metal gate (HK/MG) technology with yielding 45nm SRAM test products. This is an important milestone for UMC's HK/MG technology. We are also an industry leader in 28-nm, having independently developed the foundry industry's first fully functional 28-nm SRAM chip.''