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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (45890)	4/25/2001 9:57:21 PM
From: advocatedevil	Read Replies (1) \| Respond to of 70976

SEMI Doesn’t See Positive Equipment Sector Growth Until 2003 By Jeff Chappell, Electronic News Apr 25, 2001 --- MUNICH, Germany – Even though there is initial evidence that chip inventories are beginning to drop, it may be some time, perhaps not even until late 2002 or early 2003, before the equipment industry returns to positive, double-digit growth. That was the conclusion of Elizabeth Schumann, director of industry research and statistics for Semiconductor Equipment and Materials International (SEMI), who delivered an equipment and materials market briefing here today at SEMI’s Semicon Europa tradeshow. “Even when the (chip) demand problem corrects itself late in the year, we will still have a supply problem,” Schumann said of the demand for capital equipment. Part of the problem is that, while the semiconductor industry cycles, the corresponding equipment industry cycles tend to be more extreme. While growth rates in chip sales quadrupled in 2000, equipment sales growth rates grew more than five times faster than they did the previous year. Schumann presented SEMI statistics that show that phenomenal growth like the industry experienced last year has never been sustained for more than one year at a time. Furthermore, analysts are predicting little, or in some cases flat or negative growth in semiconductor markets this year, and that will mean flat growth, at best, for SEMI’s member companies. In fact, SEMI forecasts tool sales to remain flat at $47 billion this year and next, before rising to $54 billion in 2003 and $65 billion in 2004. In the history of the semiconductor industry, there have only been two years of flat growth, the last being in 1998, and only one year of negative growth. Schumann said SEMI isn’t expecting negative growth in chip sales this year. “Right now, we’re expecting about 5 to 10 percent growth for the year, but we’re going to have to watch that,” she said. “The latest data show (chip) inventories are coming down … but demand is kind of flat right now.” Another part of the dismal equation for tool suppliers is that, even as chipmakers cut capital spending this year, there is still de facto chip making capacity being added within the industry, Schumann explained. For example, companies are going ahead with 300mm fab plans that have already been in the works, even as 200mm plans are being pushed out or canceled. Thus even if demand picks up in end markets later this year, it is going to take time to filter down to toolmakers’ bottom lines. Link: electronicnews.com AdvocateDevil

To: Gottfried who wrote (45890)	4/25/2001 10:06:31 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

TSMC to roll out only one 0.10-micron process By Will Wade EE Times (04/25/01 17:36 p.m. EST) SAN JOSE, Calif. — In a decision that demonstrates a fundamental power shift within the IC manufacturing market, Taiwan Semiconductor Manufacturing Co. Ltd. has announced that there will only be a single version of its upcoming 0.10-micron process technology. The foundry has already completed work on some of the modules for this manufacturing technology, and hopes to roll it out in the third quarter of next year. This is in sharp contrast to the foundry market's current strategy of developing a basic version of its process but offering modified versions as well to large chip companies that have their own manufacturing capabilities. Integrated device manufacturers (IDMs), which have in-house fabs and proprietary chip-making technologies, generally can't easily shift their production to foundries such as TSMC because their chips are designed to utilize the internal manufacturing process. TSMC and other foundries have therefore been required in the past to tweak their process — at significant cost — in order to land the huge orders from these companies as more and more IDMs begin to outsource their production. "If IDMs have insisted on using their own process, we would have to modify our process to match theirs, and that can take up to six months," explained Shiang-Yi Chiang, vice president of research and development for the Taiwanese foundry. "But for the 0.10-micron process, we will not need to develop any revised design rules. This is a significant change." F.C. Tseng, TSMC's president, said there are now about five different variants of his company's 0.13-micron process, each specific to a single, large-volume IDM. The generic version is offered to fabless customers that don't have internal manufacturing processes. "The IDMs started developing their 0.13-micron processes two or three years ago, and TSMC was weak then," he said. "We couldn't negotiate." But in a shift that demonstrates the growing power of the foundries, Tseng said the company does not plan to offer any variants of the 0.10-micron process. "There will be only one version," he said. Part of the reason Tseng is confident in this strategy is the close relationship between the leading foundries and the biggest IDMs. For example, TSMC recently struck a licensing deal with LSI Logic Corp. that grants ASIC vendor LSI the right to use TSMC's processes starting at the 0.13-micron node. Tseng believes that such agreements are going to be a more important part of the semiconductor industry moving forward, and that other key IDMs will be willing to simply license manufacturing technologies from foundries rather than develop them internally. Jim Hines, foundry analyst for market research firm Gartner Dataquest (San Jose), agrees. "Creating different versions of their processes is something that TSMC and the other top foundries have been doing for some time in order to accommodate the IDMs," he said. "But I think the foundries would much prefer if they could develop just one process." The chip industry is moving toward a consolidation of manufacturing technology, said Hines, and that TSMC's standard process has nearly taken on the mantle of a de facto standard. "As time goes on, we will see fewer and fewer IDMs developing their own processes," he said. "We are already seeing some companies come to the conclusion that it is not economically feasible, even if they already have their own fabs." Hines suggested that for many companies with fabs, the cost of developing a leading-edge process is one of the major barriers that prevents them from moving their chip designs to the most advanced levels, and is therefore a common reason for these companies to begin outsourcing their production. This trend is only visible for designs based on standard CMOS logic manufacturing, said Hines. For analog, RF and mixed-signal chips, manufacturing is still so specialized and variable between companies that outsourcing is not an option. However, for the basic CMOS production, which is the majority of the foundries' business, manufacturing technology is definitely consolidating. "I think that within three to five years, if not sooner, there will only be one or two standard processes within the semiconductor industry."