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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: Mephisto who wrote (18403)	8/2/1999 5:18:00 PM
From: QwikSand	Read Replies (1) \| Respond to of 64865

So I'm not sure what's going on. For shame....<g> Butt I thought, from Eric's post, TI and SUN would collaborate on chip for MAGC. Do you know if that is correct? Correct in a minor sense. Unlike Intel and Motorola, who build ever-fancier multibillion-dollar silicon wafer fabrication "lines" (that are called "fabs" in the industry) to manufacture chips, Sun outsources the fabrication of all of its silicon...it uses what is referred to as a "fabless" model. Instead of having to develop a hugely expensive center of competency in wafer fabrication, that is, hire a bunch of solid-state physics gurus who figure out how to deposit and mask ever-smaller, thinner, faster and cooler (in the temperature sense, not the Nike sense) layers of semi-conductor stuff on silicon wafers, they leave that to Texas Instruments and others who are their "fab partners". So Sun designs the logic circuitry for the fanciest microprocessor they can, in this case the MAJC. The complexity of their design is limited by how many transistors Texas Instruments tells them will fit on a wafer made on TI's latest fab line. Then Sun "tapes out" the CPU, or writes a description of its logical structure on a disk or tape in a special computer language used to describe complex circuits. TI then takes this design tape and uses it to control the fabrication machinery at their factory. These machines deposit the invisibly thin layers of copper or gallium arsenide or whatever else onto big silicon wafers. At the end, the wafers are sawed apart (with a very delicate micro-saw) to make the actual chips. So TI and SUNW collaborate on the chip in sort of the same way that the architect and contractor collaborate on the house you're building. The architect thinks it up, the contractor puts it together. This approach lets SUNW put their R&D money into the chip's functionality instead of fabrication process development. However, each chip costs them a little more because they have to pay something to TI. If SUNW ever started selling chips in anything like the same volume that Intel sells them, they could start thinking about building their own fabs. At current volumes, it's just not possible. It's way more cost-effective for SUNW to pay the extra per-chip fee to TI, who amortizes the enormous cost of continually updating fabs over chip runs for many different customers like SUNW. Regards, --QwikSand