blake, not again? More bad news from the chairman of TSMC...but there's hope in the last sentence. For personal use only
December 2, 1998
TSMC Chairman Says Chip Prices
May Slip Under Renewed Pressure
By RUSSELL FLANNERY
Staff Reporter of THE WALL STREET JOURNAL
TAIPEI, Taiwan -- The rebound in prices of the world's most commonly used
computer memory chips during the second half of 1998 will sputter early next
year, the chairman of Taiwan's largest semiconductor maker predicted.
"As soon as the season is over, I would expect more pricing pressure again,"
said Morris Chang, chairman of Taiwan Semiconductor Manufacturing Co.
The chip maker, a 27%-owned affiliate of Anglo-Dutch Philips Electronics NV,
is also the world's largest specialized contract manufacturer of
semiconductors.
Global prices for dynamic-random-access-memory, or DRAM, chips have
soared in the past few months. Prices for 16-megabit chips, one of the
industry's main products, have almost tripled since midyear to around US$3.90
this week. That's a big change from the first half of the year, when prices
dropped amid excess capacity and fallout from Asia's financial crisis.
The recent recovery is the result of production cuts by some Asia chip makers
and a traditional pickup in year-end demand, said Mr. Chang in an interview.
"The current price rebound is due to the seasonal effect and to the short-term
supply reduction," he said, adding, "I don't think this is going to last
indefinitely."
Although prices are headed lower in the first or second quarter of next year,
they are "unlikely" to revisit their lows of 1998, said Mr. Chang. "I think the
prices will recede from the current level, but certainly I hope they will be
considerably above the low they reached a few months ago."
A lasting recovery may not take shape until the second half of next year, he
said.
G.
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