Last year's big decline in Power sales came in part because the systems were at the end of their two- to three-year product cycle. IBM announced the first generation of Power 8 systems in April.
The Power 8 processors are built in a new 22 nm process that ramped up two months ago at IBM's East Fishkill, N.Y., fab. The 300 mm wafer fab also makes processors for IBM's Z Series mainframes.
The older Burlington, Vt., fab uses 200 mm wafers. It used to make IBM processors using relatively exotic silicon germanium technology, but when the processors moved on, IBM re-tooled the fab as a foundry.
Today Burlington primarily makes chips for other companies using SiGe and a silicon-on-insulator technology, recently upgraded to a 90 nm node that is attracting customers making RF chips. The processes, while out of the CMOS mainstream, are less expensive alternatives to so-called III-V processes such as gallium arsenide and gallium nitride used for many specialty products.
For example, SiGe is also useful for high-end radar in avionics. The SOI process is being applied to RF front ends in handsets and base stations and the kind of radar cars are starting to use to prevent collisions.
IBM still makes in Burlington a few products for its own systems, including analog and other devices for its tape drives and replacement parts for older systems. In addition, it is said to have a so-called "trusted" foundry business valued at as much as $500 million a year using the SiGe and SOI processes to make high-end radar and other components for the US government.
That government business could create thorny issues for anyone trying to buy the plant, especially for buyers such as GlobalFoundries that have overseas ownership. "There's a direct link to the US government with the trusted foundry business, so that would have to stay in US hands," says a former Burlington employee.
The Burlington fab is difficult to manage, in part because it supports so many varieties of different processes for different customers. "I know people who tune the machines, and they say every chamber is different," says another former employee.
Processes currently in use at Burlington range from 350 nm SiGe to 90 nm SOI, "and within those lithography nodes there are multiple recipes," says the former Burlington employee. "A whole bunch of customers and lots of part numbers are going through there, so it's a challenge to run it smoothly."
Neither Burlington nor East Fishkill could be economically upgraded, says G. Dan Hutcheson, chief executive of VLSI Research. Next-generation lithography machines will require special floors and taller rooms, he tells us.
Nevertheless, several observers believe IBM could sell both fabs to foundries and continue to have its own chips made there. IBM could even continue to develop process technology at its T.J. Watson research center to differentiate future chip designs, transferring the processes to partner foundries.
IBM's Krishna points to an often cited statement by IBM CEO Virginia Rometty that IBM "will remain a leader in high-performance systems and continues to invest in R&D for advanced semiconductor technology."
Relying on T.J. Watson for process research does not address the development half of R&D, he says.
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