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Technology Stocks : ADI: The SHARCs are circling! -- Ignore unavailable to you. Want to Upgrade?

To: Bob Trocchi who wrote (2816)	6/19/2003 12:47:08 PM
From: Jim Oravetz	Read Replies (1) \| Respond to of 2882

IBM Wins Another Chip Customer From Taiwan Foundry Giants DOW JONES NEWSWIRES TAIPEI -- U.S. technology giant International Business Machines Corp. (IBM) has wooed another chip customer from Taiwan's foundry giants, but analysts Thursday downplayed the victory. U.S.-based chipmaker Analog Devices Inc. (ADI) said in a statement issued overnight Wednesday that it had developed a new digital signal processing chip for use in communications devices with the aid of IBM's technology and manufacturing. Analog Devices has been a longtime customer of Taiwan Semiconductor Manufacturing Co. (TSM), according to analysts in Taipei. The deal shows IBM's strength in gaining clients for its expanding semiconductor foundry business, which involves manufacturing microchips on a subcontracting basis for other companies. IBM entered the chip foundry business last year, and has aggressively attracted new business from major firms such as Advanced Micro Devices Inc. (AMD) and Nvidia Corp. (NVDA), at the expense of Taiwan's TSMC and United Microelectronics Corp. (UMC). However, analysts downplayed the significance of the victory. "The negative impact is limited. Analog Devices isn't one of TSMC's top 10 customers," said George Wu, chip sector analyst at Primasia Securities in Taipei. "People knew IBM would be able to win orders," he added. He also said Analog will likely continue to farm out production to TSMC. Most companies like to use two manufacturing sources for logistical reasons and to help negotiate better prices, he said. Analog Devices didn't disclose the extent of its manufacturing and design collaboration with IBM, nor did the companies disclose the value of the deal.