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Technology Stocks : Taiwan Semiconductor (NYSE: TSM)
TSM 331.14-0.2%Jan 13 3:59 PM EST

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To: Allen champ who wrote (577)10/27/1999 12:24:00 PM
From: Allen champ  Read Replies (1) of 684
 
TSMC plans to share quake experience in white paper

By J. Robert Lineback
Semiconductor Business News
(10/27/99, 11:41:00 AM EDT)

HSINCHU, Taiwan -- By the end of the year, Taiwan Semiconductor Manufacturing Co. expects to publish an industry
white paper to release more details about the impact of last month's earthquake on its five wafer fabs here and to provide
an overall assessment of precautions taken against powerful quakes.

The paper will summarize what worked well and what could have worked better in fabs hit by powerful trimmers, said
Yen-Chun Huang, vice president and assistant to TSMC's chairman. The high-level summary will be shared with silicon
foundry customers, wafer fab vendors, and other semiconductor manufacturers in the hope of helping the industry improve
protection against losses in earthquake prone regions, he added.

TSMC and other major chip makers in Hsinchu were knocked out of production on Sept. 21 when the region was rocked
by a 7.6-magnitude quake, causing massive power outages. The quake jointed fab gear, broke quartz tubes, knocked
lithography tools out of alignment, and wrecked about 100,000 wafers being processed inside Hsinchu wafer fabs, but no
serious damage was reported by any chip makers inside the high-tech industrial park here.

A fact-finding mission was also launched one week after the earthquake by the Semiconductor Equipment and Materials
International trade group. Like TSMC, the SEMI organization aims to create a document that will shed light on how to
build fabs and design production equipment to withstand powerful quakes.

Early on, TSMC reported that several things worked well in the emergency. One concept getting immediately after the
quake was the foundry's use of Standard Mechanical Interface (SMIF) minienvironments and pods that encase wafers
inside cleanrooms. TSMC pioneered the use of SMIF pods in foundry production 10 years ago, but no one knew how well
the concept would work in protecting production wafers in a powerful earthquake.

Less than 28,000 wafers from all five of TSMC's Hsinchu fabs were scrapped, or about 1.3% of the company's current
annual output. TSMC said it was far better than expected. Damage to some fab equipment was also limited by shock
absorbers connected to the tools. All online equipment were strapped or bolted to the floor, said the company.

An immediate inspection of TSMC's two 6-inch and three 8-inch fabs in Hsinchu turned up no evidence of structural
damage to buildings as well as no gas leaks or chemical spills. Damaged quartz tubes had to be replaced, but TSMC
said it had no difficulty securing new materials in early October, despite industry predictions of glass and quartzware
shortages.

Overall, TSMC places quake-related losses at NT$1 billion ($31.5 million) from profits, after factoring in insurance
coverage. An early assessment by all chip-producing operations in the Hsinchu Science-Based Industrial Park placed
total losses a little over $300 million. Nearly all chip plants are now operating at pre-quake capacity levels, according to
local managers.
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