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To: Greater Fool who wrote (86724)	1/12/2000 2:33:00 PM
From: Charles R	Read Replies (1) \| Respond to of 1576160

GF, <Increasing die size doesn't help unless revenues are increased to cover the opportunity cost.> Historically the die sizes remain somewhat the same inspite of finer geometries and the ASP says about the same (or goes up in some cases). I don't expect the ASPs to go up in the forseeable future (1 1/2 - 2 years) but I do expect the die size trend to hold. Let me put it this way: Intel is run by fairly conservative management and Jerry doesn't have too much money at hand to be putting in a lot of additional capacity. So, I am not concerned. Chuck

To: Greater Fool who wrote (86724)	1/12/2000 3:13:00 PM
From: tejek	Respond to of 1576160

I think 20% per year is a bit high....any statistics to back it up? ____________________________________________________________ Bullish forecasts for semiconductors, chip equipment By Therese Poletti PEBBLE BEACH, Calif., Jan 11 (Reuters) - Looming rain clouds and drizzle may have threatened their golf games, but most attendees at a semiconductor industry conference here were bullish about the $147 billion industry's current boom cycle. Many analysts and some industry executives said they are looking for the semiconductor industry to grow between 22 and 25 percent in 2000, with a possible two to three year period for the current upturn. The $30 billion chip equipment industry is also forecast to grow by about 28 percent this year. "I feel we are in a strong three-year growth period," said Stan Myers, president of SEMI, a semiconductor equipment trade group, which sponsored the conference. "Maybe we will have a quarter or two that flattens out." After a three-year downturn, the semiconductor industry's longest running downturn, the semiconductor business has been in the throes of a recovery, starting last year. Just as one of the factors fueling the industry downturn was a glut of chip inventory, tighter manufacturing capacity is one of the contributing factors to the current upturn. "Not that much capacity has been put in place in 1999," said Bill McClean, president of IC Insights Inc., a market research firm based in Scottsdale, Ariz. "You have strong growth and tight capacity...It appears the scenario is set for a strong couple of years." But the first quarter could see a temporary dip in the current uptick in semiconductor revenues, due to seasonality and as companies use up extra inventories of some chips. Analysts said that some customers double ordered some products, to stock pile ahead of potential problems with Y2K. "First quarter will be normal seasonal drop off," said Dan Hutcheson, president of VLSI Research Inc. of San Jose, Calif. "Semiconductor revenues will be down from the fourth quarter, but up from a year ago. It's a very normal phenomenon." But because of the cyclical nature of the industry, many conference speakers brought up the issue of how to better prepare for the next industry downturn, which is a certainty, even if the timing cannot be predicted. Some speakers also pointed out that even though semiconductors are the core building blocks of low-cost personal computers and servers which are key to the growth of the Internet, some aspects of chip manufacturing are still behind the times technologically. Michael Splinter, senior vice president and general manager of manufacturing at the world's largest chip maker, Intel Corp. <INTC.O>, noted that the industry should begin to use some of the advantages of a networked world with the Internet, such as employing remote diagnostics techniques for the costly equipment in a chip fabrication facility, known as a "fab." "It's very difficult for you guys to get your experts to all our factories (around the world)," Splinter said. "The industry is behind here and we need to catch up...If you don't do it someone else will." Curtis Wozniak, chairman and chief executive of Electroglas Inc., <ELGS.O> a developer of process management tools for chip manufacturing, noted that the industry needs to upgrade its manufacturing systems, many of which are using proprietary mainframe computers. "Most fabs are using systems from the '70s or '80s," he said. "The whole economy is benefiting from the networked computing environment and we are still operating back in this era, with our fabs," he said, pointing to a slide. "We are really ignoring the promise of open systems." 18:43 01-11-00 Copyright 2000 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon. All active hyperlinks have been inserted by AOL.

To: Greater Fool who wrote (86724)	1/12/2000 10:15:00 PM
From: Process Boy	Read Replies (1) \| Respond to of 1576160

GF - <When die size is increased to included L2 cache, a very expensive logic process is used to make SRAMs, which though not exactly cheap, are not the high margin product one hopes for in microprocessors.> GF, I don't believe the margins are quite as bad as you may think, and the processes themselves (w/ on-die), not as expensive as you may think. Just my unsubstantiated 0.02. BTW, what happens when one goes to 300mm wafers? If you've posted on this previously, I apologize in advance. PB