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The Loongson microchip, designed and manufactured by the Computer Institute of the China Science Academy, has been authorized and purchased by ST Microelectronics (ST), the world's fifth largest semiconductor company. The company is authorized to produce and sell the chip globally, according to the agreement reached between the Computer Institute of the China Science Academy (CSA) and ST. This deal indicates that the Loongson chip, designed and made entirely in China, has successfully integrated itself into the global chip production chain.

According to the Li Guojie, head of the Computer Institute of CSA, both parties cooperated in the development of the Chinese-developed Loongson 2E processor. The Computer Institute is responsible for the design and structure of the Longson chip,  while ST is offering microchip manufacture services and specializes in mass production and sales.

According to the agreement, the Computer Institute of the CSA has authorized ST to produce and sell the Loongson chip for a five-year term. Both parties, however, declined to reveal the exact amount of their agreement. According to an industry insider, the contractual amount is expected to be 200 million USD annually.

Reportedly, the domestic PC manufacturers who wish to use the Loogson chip will have to purchase the chip through the sales networks of ST.

Of special note about the Loongson chip is its power and energy-saving capabilities.  The chip was designed and made entirely in China, making the project completely independent of Western engineering. The Loongson CPU is a 64-bit MIPS III RISC processor. Unlike x86 CPUs, it works under only 5-7W power (4.07W in recent tests), a small fraction of AMD or Intel products which generally need signifigantly more power.

Created in 1987, ST, is the world's fifth largest semiconductor company with net revenues of 9.85 billion USD in 2006. Furthermore, ST was the third biggest semiconductor supplier in China in 2005.

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