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To: Proud_Infidel who wrote (37042)	8/28/2000 3:22:15 PM
From: Demosthenes	Read Replies (1) \| Respond to of 70976

Brian, <<Chen nonetheless said the chip cycle would become less predictable as more and more silicon finds its way into consumer gadgets rather than personal computers, which benefit from relatively stable corporate orders.>> Less "predictable?" Did he mean "volatile?" <<``This will make things rather tiring for foundries but the cycle will bottom out faster,''>> Is a tired foundry good or bad? I'm sure the meaning was lost somewhat in translation. D

To: Proud_Infidel who wrote (37042)	8/28/2000 5:32:39 PM
From: tech101	Read Replies (1) \| Respond to of 70976

Joseph, Give Us the Over Capacity! Semiconductor Business News (08/28/00, 03:18:59 PM EDT) semibiznews.com Chip shortages plague toy makers REUTERS: Chip makers blamed for troubles in toyland NEW YORK -- Toy makers are now trying to gear up production for the upcoming big holiday season, but they are having to scramble for electronic components that have become a crucial element in many of their products. But chip producers have been unable to meet this demand, and some toy makers are beginning to lose out. For holiday shoppers, this may mean a smaller selection than usual of toys that talk, blink or sing, since some of the toys that need chips may not hit store shelves until after Christmas, analysts say. "What may [happen] is that we won't see the full range or potential of toys, given the shortage of chips," acknowledges Terri Bartlett, communications director at Toy Manufacturers of America. Chip shortages already are beginning to threaten toy maker products. The world's largest toy maker is a case in point. As Mattel entered the third quarter, it found itself in a quandary when its suppliers said they would need double the time normally required to supply semiconductors, wreaking havoc on its production schedule. "All of a sudden, our chip vendors didn't have the chips we needed," a company official says. Usually, Mattel orders chips 30 to 45 days before they are needed, but as the company was readying itself for the big holiday season, chip vendors said the delivery time would take closer to 90 days. "We calculate on a specific timeline, and all of a sudden it's doubled," the company official points out. "How do you fit that into your production schedule?" The shortage, which mainly affected Mattel's preschool and infant toys division, led to its disclosure that it will lose roughly $100 million in sales in the second half of the year. The worldwide electronic-chip shortage could especially be painful for the toy industry since a growing share of its products, from dolls to sophisticated computer games, use chips now. Hasbro, the maker of Pokemon toys, already has reported that the chip shortage could hurt its performance in the second half of the year and could affect the introduction of new products during that period. And Hong Kong-based Radica Games, a maker of handheld games, said that the chip shortage will "jeopardize" its shipments for the rest of the year. Merrill Lynch analyst Hayley Kissel says that she was surprised toy makers had not secured enough chips, since there was a chip supply shock late last year that affected at least Hasbro. Toy makers also should be working much more closely with chip manufacturers to ensure a steady supply, analysts say.