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To: mailman who wrote (9566)	11/13/1997 11:03:00 PM
From: Apple12	Respond to of 25960

Keep buying! No slowdown seen in Asia WILLIAMSBURG, Va.--The financial turmoil in Asia and Latin America will have little impact on the total semiconductor equipment revenues, predicted The Information Network here today. "Asian companies have struggled to grab first place in the DRAM market over the past few years," said Robert N. Castellano, president of the Williamsburg-based market research firm. "They have been operating at 100% capacity, maintaining profitability even at dramatically lower DRAM prices. For them to cut back now on expansion of technology for next-generation devices -- with 0.25-micron feature sizes on 300-mm wafers -- will probably relegate them back to second place behind the Japanese on the 256-Mbit DRAM race." The research firm has predicted 13.7% growth in worldwide semiconductor equipment revenues next year compared to 8.2% increase in 1997 (see Nov. 4 story). "Companies are pushing to 0.25-micron feature sizes, so that the next wave of buying will be technology driven rather than capacity driven," Castellano noted. "The drop in DRAM prices in 1996 was partly due to companies trying to increase market share by increasing production. These companies certainly will not backtrack in 1997 and 1998, and they will try a new route to market share gain - invest in new fabs that are capable of producing 256-Mbit DRAMs." Castellano said the financial crisis has had a "macroeconomic effect" on Asian economies but technology-based industries will be needed to move countries out of a "third-world morass." He argued that it would be a "financial blunder for the Asian governments to allow their semiconductor companies to lose market share. Many Asian governments are funding fab construction," he added. "The continual DRAM price erosion will seriously effect only one company -- Micron Technology, which only makes DRAMs," Castellano predicted. "South Korean DRAM manufacturers Hyundai and Samsung both announced plans in March to diversify into ASICs. Taiwanese companies UMC and TSMC are foundries, making chips for other companies--primarily U.S. and Japan--and are planning their foray into the 300-mm arena before 2000." He noted that while total DRAM revenues are expected to drop 16.9% in 1997 to $20.8 billion, unit shipments will actually increase 10%, "which is good for PC manufacturers and good for consumers while at the same time keeps fab utilization high."