extract from July 9th IBD: interview with IBM:
Tough to determine impact on Fab Capacity utilisation from the following, but interesting all the same.
Memory Maker: IBM Reaffirms Its DRAM Push
Date: 7/9/97
Author: Reinhardt Krause
Chipmakers like to talk the talk: system on a chip, gigabit memory chips, you name it.
But what determines who can walk the walk? For many, it comes down to manufacturing prowess.
At International Business Machines Corp., advanced manufacturing is at the heart of its chip business. Its external chip sales were about $3.2 billion in '96, down slightly from $3.5 billion in '95, due to plunging memory-chip prices.
Nonetheless, IBM plans to stay a technology leader in memory chips. It's staking out the high ground with new chips that store 64 megabits of data.
But IBM also wants to rely less on commodity memory-chip sales. It's targeting more profitable custom chips, called application-specific integrated circuits.
Michael Attardo, general manager of East Fishkill, N.Y.-based IBM Microelectronics, spoke with IBD about his division's strategy.
IBD:
How fast will Dominion Semiconductor, your joint venture with Toshiba Corp. in Virginia, ramp up production?
Attardo:
It's perhaps the largest single semiconductor facility in the world today. It will focus initially on 64-megabit DRAMs. We'll start to get initial output at the end of this year. By July '98, we should be making about 500 wafers a day and will ramp further from there.
IBD:
Do you think chipmakers are moving to the next generation of memory chips, which store 64 megabits of data, sooner than expected?
Attardo:
We are. We already have production of 64 meg (megabit devices) in Burlington, Vt. And we're bringing on the Dominion fab. We think the profit margins will be higher.
IBD:
If the DRAM market improves, other new plants will move into production, too. That would delay a real recovery, analysts say. When do you think supply and demand will come into balance?
Attardo:
Some people say it'll be the end of '98. I would say it will probably be '99 or 2000. There is still a lot of capacity coming on line.
IBD:
If the DRAM market stays in a funk, what are your options for the Dominion plant?
Attardo:
Our fabricators are very (flexible). We can use memory as the start-up vehicle and we can move very gracefully - with the process technologies we have - into logic products.
IBD:
What's driving the growth of your external chip sales?
Attardo:
We're now No. 1 in North America in supplying cell-based ASICs, and No. 3 worldwide. It's the vehicle to provide system on a chip and highly integrated, custom logic to our customers.
IBD:
Doesn't every chipmaker want to be a system-on-a-chip supplier. What's your advantage?
Attardo:
We have a legacy of providing highly integrated solutions to our internal customers (IBM units). We have the tools to put more functions on a single piece of silicon than anyone else can do. Coupled with our process technology, we think we have a fundamental price-performance advantage for system-on-a-chip (devices).
IBD:
Chipmakers are touting ''embedded DRAM'' chips, which mix memory and logic on the same chip. Are they being overhyped?
Attardo:
It's going to happen, the question is when. The ability to integrate memory with logic is very important to exploit the speed of processors. The first application IBM will provide will be in the storage market.
IBD:
The PowerPC microprocessor hasn't successfully challenged Intel Corp. on the desktop. What is the PowerPC's future?
Attardo:
We are supplying the PowerPC to our network computing division. We see the network computer as potentially breathing new life into the volume side of the PowerPC. We have internal and external interest.
IBD:
Are you doing anything special to support Java-based applications?
Attardo:
The PowerPC will run Java applications. We're doing some things to improve performance, including Java accelerator chips, which will co-process applications in conjunction with the PowerPC.
(C) Copyright 1997 Investors Business Daily, Inc. |
