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

To: Teri Skogerboe who wrote (22353)	7/31/1998 6:23:00 PM
From: Gottfried	Respond to of 70976

Teri/all, "Memory making a comeback?" By Michael Kanellos Staff Writer, CNET NEWS.COM July 31, 1998, 1:00 p.m. PT "[The overall low-price trend] will carry over to early 2000. We said late 1999 in 1997, but we noticed nobody cut capital expenditures," said Handy. "It's going to require five or six more state-of-the-art fabs to be closed." ..in addition to Siemens'. bold emphasis mine technews.netscape.com GM

To: Teri Skogerboe who wrote (22353)	8/1/1998 10:03:00 AM
From: Ramsey Su	Read Replies (4) \| Respond to of 70976

Teri, GM, Katherine, anyone, I have repeated a number of times that I am not in the industry so I can only "analyze" via a common sense approach. The more I think about the Siemens' action to close a fab, the more puzzled I am. We are fully aware of the respective economic conditions in Korea, Japan and Taiwan. They are the biggest customers for the semi eq industry. Of the three, we know Korea has no money but has been most aggressive in attracting foreign investors since the Asian crisis. I was thinking that it will be logical for an US or EU company to buy into Korea's fabs while the price is low, infusing the much needed cash at the same time. On the other hand, one may argue that it is time for the competitors to drive the last nail on the Korean coffin. The likes of MU have been screaming about chip dumping, unfair government subsidies etc for so long that this would be the opportunity to finally even the score. Invest in the next generation, leave Korea (may be Japan also) in the dust and re-balance the cost structure so it is based on technology rather than subsidies. Instead, Siemens chooses to throw in the towel also. Could someone in the business explain the merits of this strategy, other than a total defensive move motivated by necessity? Ramsey