Micron: Analyzing the present, looking to the future
In the past, the transition from the six-inch to the eight-inch wafer processing was feasible using 85-90 percent of the current equipment install base, and changes to the tools were incremental, as were the capital costs, Shields explained. However, moving to a twelve-inch wafer process requires a completely new equipment install base, resulting in a higher capital expenditure, he added.
The way Hill put it there is no real upgrade path for 200mm fabs that compete at leading edge.
Let's just hope the financial/analyst community begins to see at least some light...
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Esther Lam, DigiTimes.com, Taipei [Wednesday 13 September 2006]
Although the issue of excessive inventory is casting a shadow over the global semiconductor industry, players in the memory sector continue increasing their capital expenditure (capex). For Micron Technology, the world's fourth-largest DRAM maker through the first quarter of 2006, as estimated by iSuppli, it is not only its DRAM business that is driving its capex, but also the market potential of NAND flash, as well as the company's drive into new markets and products, according to company vice president of worldwide wafer fabrication, Brian J. Shields.
Capex drivers...
Shields noted that, historically, Micron's capital expenditure has been consistent with companies that have one technology and one product line focus. The memory maker had equipment, and it was able to repurpose, cut and control costs by knowing what it had and what it needed. While that business model had its virtues, Micron has grown and diversified its product line to the point that solely focusing on DRAM is no longer the company's strategy, Shields explained. An expanding product portfolio (such as NAND flash and CMOS image sensor products), multiple new technology node introductions, and increased capacity all drive to a higher capital expenditure, he pointed out.
The company continues to analyze its memory and imager road maps and research new technologies that will improve its process, production capabilities, and overall ability to stand out in the market - such as moving toward 300mm wafer technology. As it focuses on new processes and new equipment, Micron anticipates that its capital expenditures will go up, Shields stated. Expenses related to updating and installing production equipment are standard for a cutting-edge company. When purchased strategically, new equipment can maximize profits, not deplete them, indicated Shields.
Capex for 2007 will surely go up and Micron regards expenses related to equipment updates and installation as a must for pursuing consistent technology advancements, Shields said.
Micron: capex trend, 2001-2006 (US$ million)
Source: Company, compiled from DigiTimes.com, August 2006.
Next-generation technology requires next-generation equipment
In the past, the transition from the six-inch to the eight-inch wafer processing was feasible using 85-90 percent of the current equipment install base, and changes to the tools were incremental, as were the capital costs, Shields explained. However, moving to a twelve-inch wafer process requires a completely new equipment install base, resulting in a higher capital expenditure, he added.
The growing consumption of memory products has necessitated an increase in equipment purchases worldwide. For Micron, growth in NAND flash memory is driving its need for new equipment and the addition of new facilities. Some facilities today have the ability to perform "flexible flows," running NAND and DRAM. Micron, having converted to 300mm technology, is contemplating using managed flexible flows at some of its sites, indicated Shields.
Similar tools, but there are other considerations
Regardless of the different types of semiconductor products, the equipment used to fabricate and manufacture them is similar. This holds true for the equipment used in the production of DRAM, especially stacked DRAM, and NAND flash. But slight differences between DRAM and NAND flash processes will likely prevent 100-percent tool compatibility.
Shields pointed out that equipment is not necessarily the only criteria on product mixture flexibility. Flexibility in product development, however, doesn't have to be all about tools, he asserted. Strong companies have extensive process development road maps that become the drivers for better product and process synergy. Equipment is selected based on those process drivers. Process optimization and product flexibility continue to be key objectives in the balance between low-cost and flexible manufacturing that relate to the products produced, Shields stated.
Product mixes make testing more complex
The growing complexity of product mixtures can affect a manufacturing company's ability to repurpose testing tools. Because the cost of new testing tools is expensive, companies are searching for more cost-effective solutions, such as outsourcing, Shields indicated.
For testing houses, new challenges arise with the growing complexity. These companies have to tailor their equipment to fulfill demand for various types of memory testing on the same test floor. Accommodating wafer sorting, test methodologies, tool configurations, among other requirements, are all issues that have to be clearly planned.
However, although Micron naturally sees some differences in the backend production of NAND versus DRAM, the memory makers believes these issues to be minimal. Shields stated that with 25-plus years of equipment development and memory testing, Micron has the ability for a virtually seamless conversion process. Leveraging that kind of experience, along with a well-established test and assembly methodology, minimizes conversion costs and complexities and maximizes Micron's competitiveness, Shields emphasized. |
