LONDON Morris Chang, chairman and CEO of foundry chipmaker Taiwan Semiconductor Manufacturing Co. Ltd., has given a dismal outlook for the world economy and the chip industry, which is closely coupled to it, according to reports.
Speaking at an awards ceremony on Wednesday (Oct. 12) Chang said no swallow will be in sight throughout next year, according to the Taiwan Economic News.
The U.S., European and Japanese economies are all in weak condition and China will not be able to bail them out unlike in 2008 because it is now struggling with inflationary risks in its own economy, Chang is reported to have said. The U.S. economy will not recover until 2013 and the European nations' debt crisis is more serious and complicated than previously thought.
As a result the semiconductor industry is going to face a slow recovery from its present, third quarter weakness, the reports referenced Chang as saying.
Chang did not quantify his prediction but recently trimmed his prediction for annual growth in the global chip market less memory to 4 percent. EE Times has predicted that, based on Q3 sales figures from TSMC and rival United Microelectronics Corp. and other inputs, the global chip market will shrink in 2011.
Part of the low growth can be explained by the weak economy. I think the other contributor to the slow growth is we are hitting Moore's Law. The cost of using the most advanced technologies is so high that only a limited number companies with high volume products can take advantage of it. Innovation can no longer rely on smaller, faster and cheaper parts. This won't be a hard limit but a gradual adjustment. Now to be fair I have said this for several years now and there has been enough innovation to delay the limits but I really think we are seeing it for real now.
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