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To: Rosemary who wrote (15087)	2/4/1999 6:01:00 PM
From: MileHigh	Respond to of 93625

Step to 0.21-micron could worsen DRAM shortage in 2000 By Will Wade Semiconductor Business News (02/04/99, 10:53 a.m. EDT) SAN FRANCISCO — With unit shipments now increasing faster than new DRAM capacity, a memory shortage could occur by next year, warned a semiconductor analyst from NationsBanc Montgomery Securities during the company's technology conference here. The shortfall of supply and demand will be exacerbated by less-effective die shrinks and a dwindling pool of DRAM vendors worldwide, said analyst Jonathan Joseph. Speaking at the NationsBanc Montgomery Securities Technology Week Conference, Joseph noted that several memory vendors have either cut their production levels or exited the market altogether in the past year. While this has cut down the worldwide DRAM capacity, overall bit demand is continuing to swell, and the overcapacity situation that plagued the sector throughout 1998 is likely to be offset within the next 12 months. Another factor is the current generation of die shrinks. While previous shrinks have led to a significant gain in die-per-wafer, Joseph noted that some Montgomery studies have indicated that the move from 0.25-micron technology to 0.21-micron manufacturing is currently yielding only 40 percent more memory bits per wafer. This is not enough to offset growing bit demand which is running at more than 80 percent annually, and increasing. "It will be pretty interesting by the end of 1999," he said. "And we could enter a DRAM shortage in 2000." Along with the memory vendors, Joseph also predicted significant growth over the next few years in the microprocessor and digital-signal processor markets, as the periodic silicon cycle is starting to swing back in favor of the chip makers.