Johnson puts the 2011 global semiconductor capex at about $51.1 billion, about 5 percent down on a spend of $53.9 billion in 2010.
It is noticeable that semiconductor test and assembly houses such as Advanced Semiconductor Engineering, Amkor and Siliconware appear higher on the list than IBM.
As Johnson said the key to semiconductor manufacturing going forward is that "You are either involved in memory, in foundry or you are Intel." Johnson added that even Intel is getting involved in foundry through its deal with Achronix.
Although 2011 capex could be reduced from the current plans if oversupply situation materializes in the second half of 2011.
The synchronization of manufacturing processes by IBM, GlobalFoundries and Samsung provides second-sourcing opportunities. In Malta, New York, 90-minutes away from IBM's wafer fab complex at East Fishkill, GlobalFoundries is building Fab 8, a 300,000 square foot clean room fab that should be capable of 80,000 wafer starts per month. It is also noticeable that Samsung is building a wafer fab in Austin, Texas, that is expected to be dedicated to foundry work.
"GlobalFoundries and Samsung will be strong competitors to TSMC at the leading edge," said Johnson.
"IBM is not investing heavily in manufacturing. It plays the research leader role," said Johnson. "It looks like fab-lite with a research emphasis. Bernie Meyerson would never give up the research," he added.
This has been the stratergy adobpted by many semiconductor biggies. TI sold some of its fab (they retained analog fabs) and went for TSMC. If this helps companies to cut down expenses, nothing wrong in this.
I am tired of everybody saying that fabs are consolidating because capital equipment prices are skyrocketing. Has anyone thought that they might be confusing cause-and-effect at least a little bit. For the capital equipment makers, the cost of producing better-and-better performing systems has not gone down. Yet there are increasingly fewer customers out there buying fewer tools because they want to save money by, "consolidating". I hate to break it to these guys but consolidation only works if you are the only one doing it. When everyone does it, prices skyrocket because there are fewer tool sales to spread your fixed costs across. This does not even take into account R&D and additional costs from the loss of capability and experience as engineers and technicians flee the capex industry.
No matter how much they try to streamline to reduce their costs, the more the hidden costs will, "skyrocket", no matter how much they whine (don't hold your breath for capex manufacturers to pick up 450). They will end up with more bottlenecks and, "premium", pricing for in-time orders. Intel knows this and will continue making money from the foolishness of others.
Good article. I heard IBM had discussions with Global Foundries this summer about selling their Fishkill fab to them. I also heard Global Foundries decided to pass on the opportunity since IBM was asking for too much money.
The research is the source of IP and therefore the differentiator in the marketplace. With fab costs skyrocketing the need to leverage the fab price tag over many chip streams and customers it becomes a better business model. As long as there is sufficient capacity and 2nd/3rd sourcing options this will continue to be the way to keep costs down and enabling resources to be concentrated on generation of money streams.
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