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Politics : Formerly About Applied Materials
AMAT 301.88-1.0%Jan 14 3:59 PM EST
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To: Kirk © who wrote (33985)2/2/2000 11:31:00 AM
From: Katherine Derbyshire  Read Replies (2) of 70976
 
>>To not be held hostage to chip shortages is often a good reason for companies to build their own fabs or, more likely, form strong alliances through
investments in foundries and such. I guess this still leads to boom and bust as they try to add more capacity than needed only to see the foundries try
to fill that capacity by lowering prices.<<

Yes, exactly.

As I understand it, the fundamental problem is that one fab is too big a capacity unit and takes too long to build. It's very difficult for one company, much less an entire industry, to time things so that capacity comes online exactly when it's needed.

Katherine
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