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

To: advocatedevil who wrote (57729)	12/18/2001 11:53:56 PM
From: advocatedevil	Read Replies (1) \| Respond to of 70976

"Citing weak demand, NEC says it will shutter Scotland fab" siliconstrategies.com NEC Corp. Tuesday said it will shut down its fab in Livingston, Scotland, and lay off the remaining 1,280 workers by April 2002, due to the depressed global semiconductor market. Earlier this year, NEC announced that it was halting DRAM production at the Scotland fab, switching to system-on-a-chip and custom LSI devices. Capacity was slated to be cut nearly in half to 15,000 wafers a month. However, officials now say that poor market demand for mobile phones and related telecommunications chips has forced them to close the fab completely. The fab could be reopened sometime in the future, if market conditions improve, NEC said. As part of its semiconductor cutback, NEC also plans to shut a pilot line for advanced LSI devices at a plant in Sagamihara, Japan,and part of a wafer line at another fab in Kyushu. Earlier this year, NEC closed its back-end test and assembly operations at a fab in Roseville, Calif., and scaled back production. NEC is also shifting production in Roseville from DRAM to SoC and custom LSI devices, which for the time being continue in production there. AdvocateDevil

To: advocatedevil who wrote (57729)	12/19/2001 4:33:54 AM
From: Sam Citron	Read Replies (1) \| Respond to of 70976

plenty of commentary lately about the upturn in foundry business being a good forward indicator for the semi sector. Perhaps we're robbing Peter to pay Paul Interesting comment, AD. I would think that if Motorola permanently shuts down a line and transfers it to TSM in accord with its new fab-lite model, it ought to help foundry utilization while decreasing overall fab capacity, so it would be net positive for SCE. If, however, it is merely a temporary shutdown, then it is a simple transfer from fab utilization to foundry utilization, or as you put it, a "rob Peter to pay Paul" type zero-sum game. Since foundries are arguably the best customers for AMAT's most advanced equipment right now, I would say that whatever is good for the foundry business is likely to be good for AMAT too. The fabless model is definitely gaining traction. It lets ESS Technology, for example, focus on its core competency in designing DVD chipsets rather than in building, operating, and upgrading a fab. If I were a theme player, I would play it for the LT by shorting the fabs and going long the fabless semis and the foundries. Sam