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To: REH who wrote (7357)	9/22/1998 6:01:00 PM
From: Gary Wisdom	Respond to of 93625

REH, the great thing about those lists is the momentum players read them and jump on too. Let em jump!!!

To: REH who wrote (7357)	9/23/1998 8:20:00 AM
From: REH	Read Replies (3) \| Respond to of 93625

NEC To Raise DRAM Prices Sep 22, 1998 (Tech Web - CMP via COMTEX) -- NEC said it will raise prices on 64-megabit Dynamic RAMs by 10 percent this month and cap its output volume by December to prevent further losses in the oversupplied memory market. Analysts said the move could spur a chain reaction among DRAM suppliers. NEC, the world's second-largest DRAM manufacturer, has made a number of changes to its DRAM strategy in an effort to return to profitability. NEC will hasten to reduce its 16-Mb DRAM output this year and will accelerate its production plans for PC-100 and Direct Rambus DRAMs. The company also plans to churn out 128-Mb synchronous DRAMs and 256-Mb DRAMs by the beginning of next year. On the manufacturing front, NEC will shrink its 64-Mb die to half its present size to attain better yields, and will restructure certain overseas fabs and back-end facilities. The price hikes come after a rough summer for DRAM makers, when 64-Mb devices fell below $10 and 16-Mb parts continued to decline in price. That prompted NEC three months ago to fix its 16-Mb DRAM prices at $3. An NEC spokesman said 64-Mb DRAM prices have now stabilized enough to justify a price hike. "There's an acceptance that [DRAMs] are already very reasonably priced and that we have to try to reduce our red ink." -- Spokesman NEC "Our big corporate customers know the market has been flooded," the spokesman said. "There's an acceptance that [DRAMs] are already very reasonably priced and that we have to try to reduce our red ink." The move could give other major suppliers the confidence to raise DRAM prices as well. Masahiro Suzuki, a senior memory analyst with Dataquest in Japan, said South Korea's Samsung Electronics may follow NEC's move. "NEC and Samsung communicate very well and they exchange a lot of information," he said. "It's a known fact that the price of 64-Mb DRAMs is too low for DRAM manufacturers," he said. "And 100-MHz DRAMs are still a little undersupplied, so [NEC] decided to raise the price." NEC recently reported a consolidated first half loss of more than $150 million, and the company said it has to take steps to prevent further losses. Along with the price increases, NEC has slashed its production of 16-Mb chips to 4 million units per month -- down from its original plan for 6 million units per month -- and will further reduce its output to 2 million units per month come December -- down from its original plan of 4 million units per month. While NEC will increase its production of 64-Mb chips from 8 million units per month today to 10 million per month by December, it will not expand production beyond that level, the spokesman said. In addition, the company will put a greater emphasis on premium DRAMs, and aims to boost production of PC-100 64-Mb DRAMs. Those parts are 5 percent to 10 percent more expensive than 66-MHz SDRAMs due to test and manufacturing costs associated with their high frequencies and tighter CAS latency requirements. The PC-100 devices make up 70 percent of the 64-Mb SDRAMs NEC sells today, but they will account for 90 percent of NEC's 64-Mb volumes by next March, the spokesman said. NEC has also accelerated its plan to bring 72-Mb Direct Rambus DRAMs into volume production. Previous plans had called for a gradual ramping of the devices starting early next year and for production volumes to reach 1 million units per month by the end of 1999. NEC now wants to reach 1 million unit per month output by mid-1999, the spokesman said. According to industry observers, Intel's first Direct Rambus chip set is scheduled to appear by the second quarter of 1999. In line with its aim to focus on high-value DRAMs, NEC will soon debut higher-density parts. A 400-square millimeter 256-Mb SDRAM will begin sampling by December, and the company expects to produce "several hundreds of thousands" of the devices by the end of 1999. The company is also going to expand its production of 0.22-micron 128-Mb DRAMs from 600,000 units per month by early 1999 to 1 million per month by next spring. The company is also trying to reduce its manufacturing costs. It is now moving to its fourth-generation 64-Mb DRAM die, which will take the part from a 0.28-micron process to a 0.22-micron process. That will shrink the die size from 104.5 sq. millimeters to 51 sq. millimeters, a is expected to substantially improve wafer yields. NEC expects 30 percent of its 64-Mb DRAMs production will be manufactured on the more advanced process technology by next March. Moreover, NEC will consolidate its back-end DRAM test and assembly operations by transferring 16-Mb packaging from a plant in Malaysia to its plant in Singapore, where 64-Mb DRAMs are now tested and assembled. A similar move will take place in Europe, where 16- and 64-Mb back-end production will move to NEC's fab in Livingston, Scotland. The company is also in the process of restructuring its productions lines in Kyushu, Japan and in Roseville, Calif. to make better use of older lines, the spokesman said. These moves follow NEC's announced plan to reduce its capital investments from $1.4 billion to $1.2 billion by delaying the completion of its fab in Yamagata, Japan by one year until 1999. But unlike several other Japanese vendors, NEC has no plans to outsource its DRAM production to overseas foundries, the spokesman said.