SAN JOSE -- Tower Semiconductor Ltd. is currently in discussions with potential partners to obtain access to 0.25-micron semiconductor manufacturing capabilities, an executive said here today. The move will allow the Israel-based foundry to gain ground, as it is one of the last foundries to offer production services at that level, while some of the major foundries are expected to roll out 0.18-micron capabilities in the near-future.
"We are in discussions now," said Eran Liron, Tower's strategic marketing manager. "We do plan to build a facility in Israel that can offer 0.25-micron services, and we will get that technology through a partner." Tower's most advanced technology now is at the 0.35-micron level.
Liron would not discuss a potential schedule for the project. He conceded that the semiconductor downturn and the current glut of foundry services make it difficult to consider breaking ground on a new chip manufacturing facility. Market research firm Dataquest has recently estimated that the foundry industry offers 30% to 35% more chip-manufacturing capacity than the semiconductor industry requires, although that could drop to below 25% by next year. Liron estimated that worldwide, foundries are running at just 60% to 70% of capacity.
Despite the difficult business condition, Liron also noted that the competitive foundry market requires his company to keep in step with the competition. He compared the group mentality of the foundry business to a the animal world.
"When a herd of animals arrives at the river to drink, they all wait to see which will be the first one to take a sip and risk
being eaten by the crocodiles," he said. "But once one of them jumps into the water, all the other animals jump in as well, and each one is thinking 'I hope the crocodiles get somebody else.'"