Now supercomputer makers are unable to stay significantly ahead of developers of consumer products like personal computers.

Microsoft, in fact, is aiming for one market that supercomputer makers are hoping will be a promising new business for them.

"But this does constitute a promise that there will be honest competition" between American and Japanese supercomputer makers.

Because the introduction of a product is still several years away, analysts said the agreement had little immediate significance for Cray and other supercomputer makers.

Will massive parallelism be accepted among corporate and university users, the bread-and-butter market for supercomputer makers?

All supercomputer makers must contend with tighter government and corporate budgets for the machines.

Some analysts released higher earnings forecasts for the supercomputer maker.

But American supercomputer makers have complained that it did not improve access to the Japanese market.

The reduction is the first large layoff for the Minneapolis-based supercomputer maker in 17 years.

Another company to watch is Cray Research Inc., the supercomputer maker.