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

To: David Rosenthal who wrote (18433)	4/2/1998 5:26:00 PM
From: Zoran	Read Replies (1) \| Respond to of 70976

Dave, I remember in 1984 when we really hit it hard. The Japanese were about take it over, they were building new fabs while our companies didn't have any money to invest. Well, the Japanese never made any real money out of their huge investments in the mid-eighties, so they really curtailed any significant boisterous fab expenditures. Fifteen years later the geography is different but not the way huge fab capital investments will be made. Koreans are more than dead, the Japanese are not going to invest anything for the next year and two (if you don't believe me go and ask AMAT sales people), European companies are too small to satisfy the growth a company of AMAT ilk needs, and the U.S., well, I feel like we reached fab overcapacity, semis are becoming commodities, prices are dropping precipitously, and 2 billion dollar fabs should be considered "irrational exuberance". After all, even INTC postponed their Texas fab for 2 years. The next push for semi equipment manufacturers will be the transition to 300 mm wafers. This transition is being pushed further into future, there will be only a few R&D fabs on 300 mm wafers available next year. Everybody is in the waiting mode, hoping that the competitor will bite the bullet and debug the whole sleuth of new and unproven pieces of equipment. Taking all these into account and knowing how many new mega fabs were built in the past two years it is very straightforward to conclude that the growth will be negative next year also. Zoran