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Semicon West 2014: SEMI World Fab forecast report

July 14, 2014 Comments off

Fabs

Fabs

Christian Gregor Dieseldorff, senior analyst, Industry Research & Statistics  Group at SEMI, presented the SEMI World Fab Forecast at the recently held Semicon West 2014, as part of the SEMI/Gartner Market Symposium on July 7.

Scenarios of fab equipment spending over time has been  20-25 percent in 2014, and 10-15 percent in 2015. At this time, worldwide fab equipment spending is about same in 1H14 vs 2H14. As for fab construction projects, 2013 was a record year with over $9 billion.

New fabs: construction spending (front end cleanrooms only!)
2013: record year with over $9 billion.
2014: -22 percent to -27 percent (~$6.6 billion)
2015: -22 percent to -30 percent (~$5 billion +/-).

Fab equipment spending front end (new and used)
2014: 20 percent to 25 percent (~$35 billion to $36 billion) – if $35 billion, then third largest on record.
2015: 10 percent to 15 percent (~$40 billion) – if $40 billion, then largest in record.

Installed capacity for front end fabs (without discretes)
2014: 2 to 3 percent
2015: 3 to 4 percent
Future outlook beyond 2015: less than 4 percent.

SEMI World Fab Forecast report status and activity outlined that there were 1,148 front end facilities (R&D to HVM) active and future. Also,
* There are 507 companies (R&D to HVM).
* Including 249 LEDs and Opto facilities active and future.
* There are 60 future facilities starting HVM in 2014 or later.
* Major investments (construction projects and/or equipping): 202 facilities in 2014, 189 facilities in 2015.

A slow down of fab closures is expected from 2015 to 2018 for 200mm fabs and 150mm fabs.

300mm is the new 200mm!

August 14, 2013 Comments off

300mm fabs.

Buyers of 300mm fabs.

300mm is the new 200mm, said GlobalFoundries’ David Duke, during a presentation titled ‘Used Equipment Market’ at the recently held Semicon West 2013 in San Francisco, USA. Used semiconductor equipment sourcing and sales is a very interesting challenge.

Qimonda, Spansion, Powerchip and ProMOS had jumpstarted the market. Now, there is a broadening user base. There is an unexpected uptake by analog and power device producers to achieve economies of scale. There has been legacy logic scaling. Also, the 200mm fabs are being upgraded to 300mm with used equipment. Many 300mm tools can “bridge” to 200mm easily.

Parts tools are seeding the ecosystem. Third parties are also able to support refurb as well as tool moves. However, we need more! Software licensing is becoming a smaller hurdle. There has been no over-supply yet!

So, what are the ‘rough’ rules of thumb for 300mm? First, there are approximately 1,500 individual tools in the open market. Few sellers know the values as the market is still developing. Twenty percent of the transactions drive 80 percent of sales. Today, the number of 300mm buyers is around  1/10th the number of 200mm buyers!

Lithography has been the biggest difference. Leading edge DRAM is far more expensive in lithography. Lithography has seen the most dramatic financial effects with explosive pricing in technology (immersion) and the need for capacity (two-three critical passes vs. one with dual/triple gate patterning. As of now, financial shocks and bankruptcies are the main drivers for used 300mm.

Next, 200mm is now the new 150mm! The 200mm OEM support is starting to dry up. It is nearly impossible to compete in productivity vs. 300mm. Oversupply is causing values to stay suppressed. The only bright spot being: there is still strong demand for complete fabs. The 200mm market split is roughly by 40 percent Asia and 60 percent rest of the world.

So, what are the likely alternative markets for 200mm and 300mm fabs? These are said to be MEMs and TSV, LEDs and solar PV.

That brings me to India! What are they doing about fabs over here? This article has enough pointers as to what should be done. Otherwise, the world is already moving to 450mm fabs! Am I right?

June ’10 global semicon update: Forget 2010, ~30 percent’s in the bag! What about 2011?

July 4, 2010 Comments off

Here are the excerpts from the Global Semiconductor Monthly Report, June 2010, provided by Malcolm Penn, chairman, founder and CEO of Future Horizons. There are a lot of charts associated with this report. The report also covers market trends. Those interested to know more may contact Future Horizons.

April set the ball rolling for a blockbuster second quarter making what will now be five successive quarters of growth. Our 3 percent Q2 growth forecast looks increasingly timid, with 6-8 percent more likely. Virtually all forecasters are now pitching 2010’s growth at the 30 percent level, so there is little left to argue about other than guessing the exact final number.

Whether the ‘final’ number is 28 or 38 percent really makes no odds; it is the underlying trend that counts, something we forecast correctly over 18 months ago.

The real issue now is “What about 2011?” We are clearly now in a boom and the next phase is bust, but when, how deep and how fast will it collapse? We are currently reappraising this and our 2011 forecast, with the analyses to be presented at our forthcoming IFS2011 Mid-Term International Forecast Seminar in London on 20th July.

Forget all of the intellectual arguments about expanded geographical customer base, broader application range and the smoothing effects these would have, all that is hogwash. The industry boom-bust cycles persist and will continue to do so all the while demand dynamics are measured in weeks and the supply-side in quarters making it impossible to ever balance supply and demand.

Semiconductor industry dynamic: Future Horizons

Semiconductor industry dynamics: Future Horizons

At this point it is pertinent to revive a slide I first presented at the IEEE meeting in Boston in 1975. This slide is as valid today as it was 35 years ago.

After four quarters of growth, the industry now finds itself in the full flood of a classic market boom. Order books are full, customers are building stocks, double ordering is rife, capacity is strained, lead times increasing and deliveries are stretched.

Inventory replenishment started in Q2-2009, due to the severe inventory overdepletion in Q4-2008/Q1-2009, and was over by Q4-2009 to be replaced by inventory building in 1H-2010, driven by lead-time extension. Typically every week of extra lead-time adds at least half a week to WIP.

Double, even triple, ordering (due to supply shortages) only really started in 1H-2010 and is definitely getting worse, but double ordering is NOT double shipping, yet. For that to happen, supply needs to catch up with demand. That leaves just one item missing from the 1975 list … ‘prices stabilise’, the worldwide semiconductor and IC ASP trends. Read more…

May 2010 global semicon update: Four quarters of sequential growth, yet still no one believes! Wake up, says Future Horizons

June 1, 2010 Comments off

Here are the excerpts from the Global Semiconductor Monthly Report, May 2010, provided by Malcolm Penn, chairman, founder and CEO of Future Horizons. There are a lot of charts associated with this report. The report also covers market trends. Those interested to know more may contact Future Horizons.

March’s total semiconductor sales came in at $26,533 billion, slightly above our February expectation, closing the quarter at $69,181 billion. This was up 2.8 percent over Q4-2009 and one of the strongest first quarter performances ever in what is normally a negative growth quarter. We have now had four straight quarters of industry growth, yet still no one believes in the strength of the recovery!

Of course, something unexpected can always go wrong but the industry fundamentals have never been better aligned. Just as 2001 ushered in the conditions for the so-called the perfect (semiconductor) storm, 2010 is now wallowing in the inverse effect. Surprisingly, few firms are tough. Most are too timid, too cautious or too scared. Welcome to the brave new world of semiconductor company ambivalence and life-threatening risk aversion. “Hello”.

Future Horizons presented its review and forecast for the global semiconductor market on the first day of their ongoing 19th International Electronics Forum (IEF) 2010 in Dresden, Germany, May 6-8. Our overall prediction was that the 2010 chip market would have a barnstorming year; only a disaster of the Lehmann Brothers scale could now derail the market.

The overall five-year forecast presented was:

* 2010: +31 percent, with still some scope for upwards revision.
* 2011: +28 percent; based on: peak of the structural cyclical boom (could stretch into 2012).
* 2012: +18 percent; based on: normal cyclical trash cycle starting 2H-2012 (1H-2013?).
* 2013: +3 percent based on: market correction in full flow (could be negative, cap ex overspend and inventory build depending).
* 2014: +12 percent; based on: start of the next cyclical recovery (single digit, if 2013 is negative).

This would take the industry to around $300 billion in 2010 with a CAGR of 11.8 percent between 2010-14. It would also signal a 180-degree reversal in the industry’s fortunes following its ‘zero growth’ 2000-09 lost decade of growth. Moreover, despite the apparent bullishness of these numbers, given the now unavoidable 2010-11 fab shortage, the growth upside for 2010-12 is still huge.

The real tragedy however of what ought to have been good news for the industry was: (a) still, no one believes in the numbers; and (b) it was entirely predictable.

We first presented this forecast in January 2009, at the high point of the industry’s economic and business uncertainty. The only change we have made in the last 17 months was to increased 2010’s growth number from 15 to 31 percent number. Whilst all other industry analysts, business leaders, trade associations and economists alike wrestled with what was happening, we alone never lost faith in the industry or what the underlying fundamentals were saying.

This cycle’s forecast was the easiest we have ever had to make. All we had to do for the IEF meeting was to adjust for the fact that the 2009 recovery was faster and steeper than even we had dared to predict. The bottom line? The industry fundamentals may often get distorted by events but they never lie, ignore them at your peril.

We were ridiculed for our optimism in January 2009 and throughout the year when we stuck to our guns. We never stopped believing in the numbers however and never subscribe to industry fashion, trend or sentiment, despite this sometime being out on a limb with industry consensus.

We are proud of the fact only we got this analysis right but equally sad that no one had the courage to listen. This was not forecast luck either; this was simply doing what we do best, making a considered analysis and then believing in what the forecast tells us.

TSMC enables business growth through effective and collaborative innovation

May 27, 2010 Comments off

Dr. Jack Sun, CTO and vice president, R&D, TSMC.

Dr. Jack Sun, CTO and VP, R&D, TSMC.

While speaking on ‘Enabling business growth through effective and collaborative innovation’, at the recently held International Electronics Forum (IEF) 2010 in Dresden, Germany, Dr. Jack Sun, CTO and vice president, R&D, TSMC said that TSMC leads and invests heavily in competitive, energy efficient, and eco-friendly technologies to enable product innovation, such as CMOS platform scaling (40/28/20nm/FinFET, low-R,ELK..), More-than-Moore, and integrated package/3D-IC.

He added that TSMC strives for manufacturing excellence and capacity, and economy of scale, to support customers’ innovation and business growth. The company is also pushing the acceleration of EUV and Multi-Ebeam capabilities for cost-effective density scaling. His clear message was, “We must and can collaborate to innovate and overcome the technical and cost challenges.” That is, a collaborative innovation among the government, the industry and the academia is required to overcome the cost hurdle.

Earlier, he said that the IC industry will continue to grow — with a 22 percent growth likely in 2010, reaching $276 billion. During 2011-2014, he estimated a 4.2 percent CAGR for the IC industry and 7.2 percent CAGR for fabless companies.

Dwelling on the application and technology trend, Dr. Sun pointed out that the trend is SoC and heterogeneous integration at chip, package, and product level with embedded power-efficient processors, hardware accelerators, and special features.

TSMC continues to further expand its offering by including packaging services and silicon foundry services. This will allow the fabless semiconductor companies to achieve ‘More than Moore’ gains in integration by using TSMC as a foundry partner.

Dr. Sun also detailed the how TSMC enables innovation by providing best-in-class technology and design solutions.

* ‘Green’ CMOS technology platform – Moore’s Law.
— High density energy-efficient transistors and interconnect $ most desirable for embedded SoC.
— Pushing reduced-cost lithography and 450mm.
* Eco-friendly fine-pitch integrated packaging technology and 3D-IC
* Special/derivative technologies to interact with the external world – More-than-Moore.
— MCU, MEMS, RF, analog, BCD power, CIS, Display Driver, etc.
— Re-use and leverage compatible CMOS platform backbone and IP
* Open innovation platform and ecosystem of IPs.

TSMC’s 20nm and 28nm leadership
TSMC’s CMOS platform leadership clearly highlights future 20nm technology as well as 28nm leadership. Dr. Sun also highlighted how customers innovate with TSMC 40nm. Currently, there are more than 60 customer product tape-outs. More than half are in production with D0 <0.1 ~ 0.18. The monthly 40nm CyberShuttle has delivered >780 blocks for design/IP verification.

While on TSMC 28nm technology highlights, Dr. Sun said that the 28LP (poly/SiON) yield is approaching mature level on 64Mb SRAM. Also, the 28nm HKMG (28HP/28HPL) development is on track. Here, TSMC developed Gate-Last process with N+/P+ work function and superior performance, yield, manufacturability, variability,and reliability.

Also, it achieved double-digit 64Mb yield, good Vccmin, close-to- targets transistors, and good pre-qual reliability.

Dr. Sun added that a steady stream of shuttles have been running since the first one was launched in Jan’09. Almost every shuttle is 100 percent utilized. This implies an intensive customer engagement by TSMC. Over two dozen customers are said to be working with TSMC on 28nm technology across all application segments.

Now, on to TSMC’s 20nm highlights. The key technology features include planar transistors with 2nd-generation HKMG and 5th-generation strained Si; low-resistance ultra-shallow junction with M0 and enhanced millisecond anneal and silicide; and enhanced ELK and 2nd-generation Low-R interconnect.

Some other 20nm tehchnology highlights include immersion lithography with innovative patterning and layout solutions to achieve 2x density over 28nm, with the EDA tool likely to be ready by mid 2010. Also, the design rules are compatible for EUV and Multi-Ebeam insertion for selected layers in 2013-2014. Wow, this is really something! Read more…

Semicon is no longer business as usual!


The Global Semiconductor Monthly Report June 2008 from Future Horizons, states: Let the market beware; it is no longer business as usual!

I would completely agree! For instance, the industry has since long moved to fabless, and now, fabless firms are ranking among the very best. Or, even from 130nm to 22nm process nodes, or from 180mm fabs to 450mm fabs!! Fair enough?

Coming back to the industry trends, Malcom Penn, CEO, Future Horizons, says that compared with March, the IC units were up and ASPs were down in April, even after adjusting for March being a five-week month. The net result was a 7.7 percent revenue decline! Does this spell more bad news for the beleaguered chip market?

Certainly, this seems to be the industry consensus view. Always the contrarian, Future Horizons’ views are different. Here’s how! April’s results came in exactly as expected. Also, the unit rise and fall was simply the result of the engrained ‘making the quarterly number’ mentality!

Digging beneath the layers reveals a set of market fundamentals that are in remarkably strong form. The penny may not yet have dropped to the table, but, even for the chip industry ever full of surprises, let the market beware; it is no longer business as usual.

Penn says: To paraphrase the late Sir Winston Churchill’s comments on Russia, “The chip industry too is a riddle wrapped up in an enigma”. It marches to its own complex interwoven pattern of rules, each relatively simple when viewed in isolation, but contriving to interact in a volatile and unique way. Right now, the industry is at its most confused [state] for a decade, battered by a barrage of uncertainties and contradictions. Shell-shocked and confused, confidence is off the agenda … just when what is needed most is cool heads and determination.”

Be it falling cap ex, tight capacity, focus on profits, continuing strong market demand, second half seasonal effects, according to him, the forecast tea leaves all seem to be pointing in the same positive direction. Has the worm finally turned then for the industry? He thinks so! Future Horizons also thinks that the “penny has yet to drop and that the impact on the market will be seismic and dramatic”.

Earlier, the Semiconductor Industry Association (SIA) reported that worldwide sales of semiconductors of $21.8 billion in May were 7.5 percent higher than the $20.3 billion reported for May 2007, reflecting continued strong sales of consumer electronic products. May sales were 2.8 percent higher than the $21.2 billion reported for April 2008.

Do bear in mind that May is historically a strong month for semiconductor sales, as per SIA.

NAND strong minus Apple effect
DRAMeXchange has indicated in its monthly review on the DRAM segment that the NAND Flash prices are likely to gradually stabilize after mid-July pushing by lower price, new demand from 3G iPhone, smart phones and low-cost PCs.

Elsewhere, as reported by Semiconductor International, according to Semico, NAND unit shipments are likely to cross over 3.5 billion units in 2008 as against 2.5 billion units in 2007, leading to a year-over-year growth of 35 percent.

However, reflecting the memory segment’s ASP (average selling price) crunch, NAND revenues will grow 13 percent in 2008, down compared to 25 percent in 2007.” Semico has said that the NAND industry will record a growth year in 2008, without experiencing what it has called the ‘Apple effect’.

Heartening solar initiatives
The one heartening thing to note has been the various solar related initiatives that have taken place over the past month (actually, for over the year!). In fact, iSuppli has probably been spot on while analyzing that investments in solar and semiconductors could be on par by 2010!

SVTC Technologies, an independent semiconductor process-development foundry, announced that its SVTC Solar business unit has launched the Silicon Valley Photovoltaic Development Center in San Jose. Canadian Solar and LDK Solar signing a new agreement for an additional 800MW of solar wafers, besides LDK updating on its polysilicon plant in China.

National Semiconductors also entered the PV market with its SolarMagic technology that maximizes solar energy production. Evergreen Solar, a maker of solar power panels with its proprietary, low-cost String Ribbon wafer technology, signed two new long-term sales contracts. Tokyo Ohka Kogyo Co. Ltd and IBM are also collaborating to establish new, low-cost methods for developing the next generation of solar energy products.

Not be left behind, Intel too is spinning off key assets of a start-up business effort inside Intel’s New Business Initiatives group to form an independent firm called SpectraWatt.

In India, solar has been making rapid strides, especially at the Fab City in Hyderabad. There is a possibility of something similar happening in Karnataka state as well.

Indeed, semiconductors are no longer business as usual! Right?

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