Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 334.38

-0.7%

11:23 AM EST

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To: Katherine Derbyshire who wrote (44530)	3/25/2001 9:09:47 PM
From: Sam Citron	Read Replies (2) of 70976

Katherine, Thanks for the pointer to the NECX site, which does indeed contain spot market prices and price charts for a great variety of different ICs. However, it would seem to me that there is a big difference between ASP and spot prices. Namely, spot pricing bears the full brunt of Moore's law. Over time there should be around a 30%(?) annual price decay. Whereas, ASP probably has a tendency to rise over time as increased bit density of the "average chip" overcomes the "natural" Moore's law price decay. It would seem to me that it is precisely this increased bit density factor that accounts for why ASP may be such a good leading indicator for Semiconductor capital equipment sales. Does this sound correct to you. I would expect that stability of spot price for a particular chip over a 6 month period would be an anomaly and price rise would be rare but perhaps quite significant. Such data may have profound implications for investors in semiconductor companies, but perhaps less for those in semiconductor capital equipment companies. Comments?

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