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To: Trooper who wrote (64)	2/2/1999 7:59:00 PM
From: tech101	Respond to of 1056

ST Microelectronics Economist Sees Strong Signs of Chip Turnaround By Matthew Sheerin Electronic Buyers' News Story posted 6 p.m./3 p.m., PST, 2/2/99 SAN FRANCISCO -- Citing surprisingly strong global chip sales in the fourth quarter of 1998, a leading industry economist believes semiconductor demand could come in line--and possibly outstrip supply--sooner than expected. "It was the strongest quarter in the history of semiconductors," said Jean-Philippe Dauvin, corporate economist for STMicroelectronics NV. During an interview today at the NationsBanc Montgomery Securities financial conference here, Dauvin said he may soon revise his previous forecast for global chip sales in 1999, which currently is at 7%. "If I do revise it, it won't be to 7.5, but probably much higher," he added. Pointing to strong expected demand in the PC sector and in the embedded-controller market due to Y2K concerns, Dauvin said the supply-demand imbalance that has plagued component suppliers in the last three years could end in the second half of the year. Dauvin is reluctant to revise the forecast just yet, however. "January and February will tell whether this is a clear [upward] trend" or just seasonal, Dauvin said. Nevertheless, Dauvin believes the semiconductor bust of 1998 will give way to a new boom, as new markets develop and chip revenues return to possibly double-digit growth rates (see story in the Jan. 15 publication of SBN). The the Paris-based economist is also concerned about continued problems in Japan, where semiconductor sales fell 20% last year and 40% over the last four years, he said. "Japan represents a quarter of the [global] business." Dauvin predicted that DRAM prices, which have stabilized in recent months, "could take another dip" in the coming months due to competition in that market, despite production cutbacks. Semiconductor ASPs overall, he said, are slipping at appropriate rates. ST itself hopes to make use of two new fabs -- which are currently idle -- by year's end, said Francois Guibert, group vice president of business planning and development for the European company. The facilities, in Italy and France, will be equipped to produce chips at line widths of 0.25- and 0.18-micron. "We will equip it quickly as soon as the market rebounds--hopefully by the end of '99," he said. semibiznews.com

To: Trooper who wrote (64)	2/2/1999 8:01:00 PM
From: tech101	Respond to of 1056

Year 2000 Bug Might Be Good for Chip Sales, Says Dataquest SAN JOSE--The much discussed threat of a Year 2000 software bug will help give chip sales a shot in the arm early in the second half of 1999, according to Dataquest here today. The market research firm said it now expects worldwide chip revenues to grow 15% to $154.5 billion in 1999 after last year's 8.4% decline to $134.8 billion, according to a recently revised estimate. Firming DRAM prices and "protective ordering" by chip buyers worried about the Y2K problem will help drive semiconductor sales higher in the final two quarters this year, according to Dataquest analysts. "The third quarter of 1999 should bring good semiconductor growth -- helped in part by 'protective ordering' in advance of potential year 2000 problems -- followed by a strong fourth quarter of 1999," said Ron Bohn, director for Dataquest's Worldwide Semiconductor Research Operations. Semiconductor growth, as measured in dollar revenues, will also get a boost from a stronger Japanese yen exchange rate and firming of DRAM prices in the second half of 1999, said Joseph Byrne, senior semiconductor industry analyst at Dataquest. In a forecast presented last month at the Industry Strategy Symposium (ISS) in Pebble Beach, Calif., Dataquest predicted that DRAM revenues would rebound with a 30% increase to $31.8 billion vs. $18.5 billion in 1998. In the year 2000, DRAM sales will surge 72% to $31.8 billion, according to the forecast. semibiznews.com

To: Trooper who wrote (64)	2/2/1999 8:05:00 PM
From: tech101	Read Replies (1) \| Respond to of 1056

Another Sign of Chip Industry Recovery and Strong Demand for Chips Ahead Intel reportedly moves ahead with 300-mm fab in Oregon By Jack Robertson Story posted updated 7:30 p.m./4:30 p.m., PST, 2/2/99 SANTA CLARA, Calif. -- Intel Corp. here has decided to go ahead with its delayed 300-mm development fab in Hillsboro, Ore., and next month the company plans to announce a ten-year, $10 billion program to fund IC production on the larger wafer diameters, according to sources today. Intel's 300-mm development fab was put on hold last April after the company decided production tools were not ready in 1998. Intel then decided to revisit the decision at the end of 1998, and now it has apparently determined the time it right to restart the $1.5 billion pilot line project. A spokesman for Intel in Hillsboro said he was unaware of any decision to announce 300-mm plans but that the fab continues to be evaluated. "The facility is nearly completed, but the next phase remains in a state of 'suspended animation,'" he added. When the 300-mm development fab does begin its work, the facility will focus on 0.13-micron process technologies. Intel is expected to restart the Hillsboro fab project later this year and eventually expand the facility into its initial 300-mm production plant, according to the sources. Next month's announcement will cover a full-blown Intel plan to expand 300-mm production in multiple plants over the next decade. Intel's commitment to 300-mm is expected to help revive the chip industry's lagging interest in 300-mm wafers. Chip makers around the world have delayed 300-mm plans partly because of a lack of production-worthy tools, but mostly because of a severe glut of 200-mm fab capacity. To date, only Siemens AG and Motorola Inc.'s Semiconductor Products Sector have jointly set up a joint-venture 300-mm pilot line in Dresden, Germany. One major equipment firm, Applied Materials Inc., reportedly will reinstitute its own 300-mm program, based on a large order for equipment from Intel for the new Oregon fab. Along with the rest of industry, Applied froze its 300-mm program early last year when chip makers backed away from launching even pilot lines. semibiznews.com