Interesting article for AMAT followers:
Fabless IC firms will need 40% more silicon from foundries
SAN JOSE -- Fabless chip companies will need the equivalent of more than 8 million six-inch wafers in 1997, an increase of
39% over the amount of silicon used last year, according to a new forecast released here today by the Fabless Semiconductor
Association. Until the end of the decade, fabless chip suppliers will need an average of 40% more wafers each year, the 1997
study found.
The forecast, based on an annual survey companies, underscores the strong growth of fabless semiconductor houses and their
use of third-party foundries. The survey results also paint a clear picture of closer relationships between fabless chip companies
and their foundries.
After silicon shortages in 1995, wafer demand and fab capacity are now in a more healthy balance, said Robert S. Pepper,
chairman of the association. Pepper, who is president and CEO of Level One Communications Inc. in Sacramento, Calif.,
believes greater harmony between fabless chip companies and foundries is needed. The association said it aims to promote
both fabless and pure-play foundry business models.
The 1997 study shows that fabless chip companies now expect to get 75% of their products from pure-play foundries. About
30% of the processed wafers will be under "take or pay" arrangements with these foundries, according to respondents.
The survey also indicated that fabless chip companies now expect to have greater access to advanced technologies from their
foundries. The survey concludes that 73% of wafers processed for fabless chip companies had feature sizes smaller than 0.6
microns in 1996. A year ago, companies had expected that half of their products would be processed in that kind of
technology.
By 1999, fabless semiconductor companies expect to move more than half of their products to 0.35-micron or below
technologies. These products will require four or more layers of metal, the survey concluded.
The survey shows fabless companies expect their use of 0.5-micron and below CMOS to grow from just 500,000 wafers in
1996 to 3.8 million wafers in 1999--a compound annual growth rate of about 100%. By 1999, fabless companies will need
2.7 million wafers processed in 0.35-micron and below CMOS technology compared to only 50,000 wafers in 1996. About
28% of the wafers used by fabless companies will have feature sizes smaller than 0.35 micron in 1999, according to
respondents.
Ironically, fabless chip companies said they used fewer wafers in 1996 than they did in 1995 because of the move to smaller
device geometries and die sizes. The shift from 6-inch to 8-inch wafers also enable fabless chip companies to trim their silicon
requirements, according to survey. Pepper said many fabless chip companies had expected to gain 1.5 to 1.78 times more die
per wafer but the 8-inch technology had yielded two times the number of chips, according to many survey respondents. A
slowdown in overall semiconductor growth last year also contributed to the decline in silicon demand last year.
But looking ahead, respondents to the survey said they will require 45% more silicon in 1998--an increase of 1.1 million
six-inch equivalent wafers. In 1999, fabless chip companies expect to use 1.2 million more wafers, an increase of 36%,
pushing total worldwide foundry demand near 10.5 million wafers. --J. Robert Lineback |
