All: Interesting perspective re Japan & DRAMS:
semi.org
Market Focus
Japanese Market Shows
Steady Increase Since
January
A Feature of SEMI's Equipment and Materials Market Statistics Program
by Yasuo Komatsuzaki
The decreasing trend in Japanese integrated circuit output apparently bottomed out with a -20.7
percent year-to-year growth rate in January 1997 and has since shown a steady increase in
quantity, according to data from MITI. On the other hand, Japanese IC manufacturers suffered
from the quick price decline in the DRAM business during 1996 and from the unstable
supply-and-demand balance in the market in 1997. Under these circumstances, the ratio of
DRAM revenue to total IC production by Japanese manufacturers fell to about 30 percent in 1996
from a 40-50 percent level in 1995. However, Japanese manufacturers recognize that DRAMs are
and will continue to be one of the key ICs and a major product line. Also, DRAMs are one of the
important core devices of system LSI, so this level of about 30 percent will be maintained.
Japanese manufacturers also keep in mind that it is essential to develop leading-edge technology
for DRAMs so IC manufacturers can successfully participate in the business. Japanese
manufacturers understand very well that, in the unstable and harsh DRAM business, any hesitation
in the development of this leading-edge technology will mean losing position in the fast-moving
market.
IC manufacturers are now focusing on production technology development two to three
generations ahead of current production levels. NEC has announced the success of 4 gigabit
DRAM trial production and scheduled sample delivery in 2000. In present production operations,
new production technologies have been applied for greater cost savings. Also, IC manufacturers
are now designing fabs to enable mixing the production flow of DRAMs (and other memories) and
logic devices. This will enable them to react flexibly to any unstable supply-and-demand balance in
the DRAM market and to produce highly integrated systems of LSI-embedded microprocessor,
DRAM, logic and other intellectual properties such as high-speed SRAM, audio, video or 3D
graphics accelerator, etc., in one chip.
NEC also announced plans to spend 400 billion yen to establish a production line for
system-on-chip devices and a 64-megabit DRAM shrink version applying 0.25-micron
geometry/200 mm wafer between 1997 and 1999. Toshiba plans to build a new mixed flow line
for production of both 64-megabit DRAMs and system LSI embedded 32 bit microprocessors
3D graphic accelerators, etc., in one chip with 0.25-micron geometry/200 mm wafers, spending
100 billion yen at the Oita factory. Fujitsu will start to construct a mixed flow line with
0.25-micron/200 mm wafers for system LSI production in the Aizu factory. Many other Japanese
IC manufacturers have taken aggressive steps to have their own production facilities for system
LSI.
The market for system LSI is very small at present and is not a product category of the Worldwide
Semiconductor Trade Statistics (WSTS). But it is forecast that the system LSI market, especially
media processors designed for the increase in multimedia applications, will grow rapidly in the
worldwide market as shown in Figure 1, especially in Asia (Japan) and Europe where there are
many consumer electronics manufacturers with high capability for production of new consumer
electronics products. Japanese IC manufacturers are expecting much of this new product and
anticipating its market growth in the multimedia society. In Japan, IC manufacturers are also the
manufacturers of consumer electronics products. They have much interest in creating many new
products to meet the needs of multimedia, using flat panel displays such as high-quality 40-inch
plasma displays, LCD panels and electroluminescent (EL) displays, incorporating small batteries
and technology to minimize the size of electronic products.
To realize these intentions, system LSI will become a key component of electronic products
because higher quality, lower electric power consumption, smaller size, more flexibility of design
and cost savings are expected because of its excellent characteristics. Therefore manufacturers are
taking the approach of embedding memory and logic in one chip, applying 0.25-micron geometry
and advancing to 0.18 and 0.15 micron to realize easy production of system LSI, similar to the
current production of DRAM or logic itself, even if system LSI has both structures and complex
layers.
Also, it is expected that IC manufacturers will have the capability to create effective functional
system designs and manage the formation of these products as system LSI designed to meet the
requirements of attractive electronic products, satisfying customers' requirements. IC
manufacturers have to manage the flow of resources, including money and people, into these fields.
They also expect much effort by equipment and materials manufacturers to develop, by themselves
or with support from IC makers, a supply of highly reliable equipment and materials applicable to
the leading-edge technology needed for this new IC production, with high cost-performance ratios.
If the products of equipment and materials manufacturers meet these requirements, their business
opportunities will be expanded widely. Many construction plans for huge fabs have been appearing
in many regions in the world as shown in SEMI International Fabs on Disk.
It was a little difficult to find information about the plans of 300 mm wafer fabs in 1996 issues of
International Fabs on Disk, but in 1997 many plans have appeared, and news also has been
released to the media in Japan. Hitachi, NEC and Mitsubishi are scheduled to start volume
production of 300 mm wafers in 1999 or 2000, and Toshiba, Fujitsu, Matsushita, Oki and KTI
will follow. Plans for the U.S., Korea, Taiwan and Europe are shown in International Fabs on
Disk, but in the starting period of 300 mm wafer volume production, 1999 to 2001, the total scale
of production plans is the biggest in Japan, backed up by the activity of SELETE for equipment
and materials evaluations.
Considering the current situation in Japan, MEMC Electronics Materials, a large German-based
silicon wafer manufacturing company, is planning to construct an R&D center in Japan for 300 mm
silicon wafer production technology including single crystal pulling, and processes like slicing,
polishing, epitaxial growth, test, analysis and evaluation, at a cost of 28 billion yen. The technology
developed by the R&D center in working with Japanese IC manufacturers will be used in other
regional production plants around the world that are planned for construction in the near future.
Japanese IC manufacturers have maintained R&D activities covering many fields related to
semiconductor IC device manufacturing, and more than 10 percent of total IC shipment value has
been spent on this, as shown in Figure 2. This ratio has been kept even though the IC market
declined and investment decreased. As a result, there are many small R&D fabs and
new-generation pilot plants in Japan with production levels of less than 5,000 wafers (200 mm)
per month.
Of course, there are many fabs with production levels of 20,000 to 30,000 wafers (200 mm) per
month, but the average of all production lines is 12,000 to 13, 000 wafers per month, much lower
than 23,000 to 24,000 wafers per month in Asia (Korea, Taiwan and others) as shown in
International Fabs on Disk. This indicates that R&D work has been very active in Japan. NEC
announced an expenditure totaling 200 billion yen for a new R&D center at the Sagamihara
factory. Also, Fujitsu released its firm plan for construction of a new R&D center for leading-edge
technology for 0.13-micron and further deep-submicron process designs using
300 mm wafers, spending 73 billion yen as a first stage in Akiruno city with operations to start in
2000. Other IC manufacturers will follow.
IC manufacturers will make a continuous effort to recover this R&D expense by applying the
developed technology to production cost savings. Japanese IC manufacturers will do this and keep
up their R&D activities, although expensive, because they recognize that these activities are
essential to survival as a player in the semiconductor industry.
About the Author . . .
Yasuo Komatsuzaki is assistant to the president of SEMI Japan and is based in Tokyo. He
may be reached at (81) (3) 3222-5755 or by e-mail at semijapan@semi.org.
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