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Technology Stocks : Micron Only Forum -- Ignore unavailable to you. Want to Upgrade?

To: Sridhar Srinivasan who wrote (28587)	2/18/1998 11:56:00 AM
From: DJBEINO	Respond to of 53903

Chip makers face hurdles in 256MB DRAM production By Yuko Inoue TOKYO, Feb 18 (Reuters) - Moves by Japan's Mitsubishi Electric Corpand Oki Electric Industry Co away from DRAM mass-production mark the start of a survival race for chip makers as they face the technically challenging production of 256-megabit DRAMs, analysts say. Mitsubishi and Oki said on Tuesday they would give up a strategy of relying on volume sales of general-use dynamic random access memory (DRAM) chips, starting with the next-generation 256-megabit DRAMs, although they would continue to develop and produce them as a base technology for custom-made products. The firms said they would shift focus in the 256-megabit DRAM business to logic chips with built-in DRAMs and sophisticated high-speed products tailored to customers' needs. "We'll curtail investment in general-use 256-megabit DRAMs to a minimum," a Mitsubishi spokesman said. The 256-megabit DRAMs are expected to emerge as mainstay memories for personal computers in around 2000. Chip makers are likely to launch investment in the facilities around 1999. Analysts expect gaps in manufacturer competitiveness to widen with the next-generation chips, which require high levels of expertise with new production equipment and materials, sophisticated production processing controls and etching technologies. "Technical hurdles for 256-megabit DRAMs are very high," said Mami Indo, an analyst at Daiwa Research Institute. "Many chip makers will be forced to change their strategies so they can concentrate their resources in specialised areas," she said. Japan's Hitachi Ltd, for instance, could seek a strategy shift similar to those of Mitsubishi and Oki shortly, she said. Analysts said competitiveness among chip manufacturers had tightened since the early 1990s with the production of previous-generation 16-megabit DRAMs and 4-megabit DRAMs. Development of chip production equipment such as steppers and testers had made the technology accessible for new entrants, increasing the number of suppliers and causing supply gluts along with a sharp fall in chip prices, analysts said. Naoki Sato, an analyst at HSBC Securities Japan Ltd, said the current situation had made it difficult for chip makers to earn large profits from mass-production of DRAMs, although the situation was unclear for the next-generation chips. In sharp contrast to chip manufacturers dented by large operating losses, Nikon Corp, Advantest Corpand other chip-production equipment makers are enjoying booming profits helped by sales increases in Asia. Last summer, Advantest revised upwards its group net profit forecast for the year to March 31 to 38 billion yen from an earlier estimate of 29 billion yen. Copyright 1998, Reuters News Service

To: Sridhar Srinivasan who wrote (28587)	2/18/1998 9:37:00 PM
From: Chas	Respond to of 53903

Sridhar, I am not trying to be anything, I have given my view, and you can agree or not, I do not care. I cannot get into substance without giving out confidential information. No one really knows when crossover will happen until it does. It will happen at the OEM accounts at an earlier timeframe most likely than in the spot or in the retail market. Whether it happens in Q2 or Q3 or Q4 will depend on a number of things that could happen, you know that. If the market were to suddenly go into a shortage on certain products it could delay crossovers. I do not pretend to be any expert, but I am involved in this business so I have a view. I am not a bear nor a bull on Micron. Good trading.

To: Sridhar Srinivasan who wrote (28587)	2/19/1998 5:03:00 AM
From: Skeeter Bug	Respond to of 53903

sridhar, please don't put dj up as the harbringer (sp?) of publically available news. that one has me laughing. in any case, the 64 mb question is a good one. i don't have a good feel for it. however, going along with the macro theme of oversupply killing slowing demand (based on publically available facts ;-), it would seem to me that everyone will lose in 64 mb, too. including the low and lowest cost producers. bit production will increase 30% above already excessive supply levels at the very least. i believe it will be much greater, though i can't substantiate it. yet... ;-) the real question is how is mu going to afford the ever more expensive hands of this no limit poker game? the reason mu is a lower cost producer is b/c they paid the pretty pennies. those pretty pennies are getting scarce right now. they can't even afford a dividend. after this q is over mu will have made $0.70 cents in the last 15 months of the 16 mb cycle. the most profitable months, too. all this for $35 ;-)