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the_floating_ gate
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re: London Calling: GloFo and the end of easy money
the_floating_ gate   11/22/2012 4:46:01 AM
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In the year 2015 .... there will be a reality check... TI was always a driver in developing leading edge but they smelled the coffee... TI getting rid of mobile business is telling - Amazon (eventually) picking up TI's mobile business just shows a complete lack of understanding the manufacturing aspect of advanced logic chips. here's what ASML has to say... In regard to 20 nanometer nodeacegoa very little intention node, so you’ll see about from the 28 nanometer to the 20 nanometer node about a 1.7, 1.8 times the investment for the same number of wafer starts at the 28 nanometer node.. considering how much water a wafer fab needs it's silly to build a fab in the desert anyway ...

Peter Clarke
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re: London Calling: GloFo and the end of easy money
Peter Clarke   11/22/2012 4:06:08 PM
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Abu Dhabi isn't in the desert. It is one the United Arab Emirates on the coast of the Persian Gulf. I suspect other consideration than the availability of water rank higher as to whether it makes sense to build a wafer fab there. If water is needed it will be brought. Bringing people is harder.

RobinHoo
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re: London Calling: GloFo and the end of easy money
RobinHoo   11/22/2012 7:22:09 PM
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At least they build solar panels for to provide electricity to power the desalination plants, instead of burning wells of oil to do so.

Kresearch
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re: London Calling: GloFo and the end of easy money
Kresearch   11/22/2012 11:05:51 PM
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I don't expect Glofo could achieve that goal in 2015 with 14nm FINFET in mass production based on past record. I bet Glofo set on sale in 2014 and SAMSUNG will acquire it and UMC, SMIC will be acquired by TSMC by then. In 2015, INTEL, TSMC and SAMSUNG became top three foundries.

Peter Clarke
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re: London Calling: GloFo and the end of easy money
Peter Clarke   11/23/2012 9:08:28 AM
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@Kresearch The goal of profitability? But if not profitable would Samsung buy, just to take competition off the market?

Kresearch
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re: London Calling: GloFo and the end of easy money
Kresearch   11/23/2012 12:03:59 PM
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No. It would be like GloFo acquired Charter Semi to expand foundry customer base which is important for business expansion. There is some similarity between Samsung and GloFo at that time.

Peter Clarke
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re: London Calling: GloFo and the end of easy money
Peter Clarke   11/23/2012 9:09:22 AM
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@Kresearch I suppose it could help Samsung learn/extend its foundry business.

SiliconAsia
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re: London Calling: GloFo and the end of easy money
SiliconAsia   11/27/2012 4:59:02 PM
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Kresearch/Peter! This logic has flaws. GloFo never was a foundry before acquiring Chartered at the end of 2009. (only had one customer, it's own parent company). Samsung is already doing substantial foundry business with major customers like Aple, Qualcomm, Xilinx, and etc..

DMcCunney
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re: London Calling: GloFo and the end of easy money
DMcCunney   11/26/2012 7:56:46 PM
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I don't see a direct connection between funding for Global Foundries and building a fab in Abu Dhabi. The Emirate recognizes that its economy must have a broader base. But an economic contribution to an economy doesn't require a facility in the economy. Money can be made anywhere in the world. The initial investment in Global Foundries was likely an effort to generate revenue and earn income. In such a case, one of the investor's questions will be "How much investment is required to make this a going concern, and when might we expect it to be profitable and producing a return on our investment?" It appears that the folks providing the funding have decided that it's time the investment started to provide a return. An IPO, if successful, does what any startup investor wants: it repays what they invested, and provides a return on top of that. I think we can assume Abu Dhabi's fund will retain a stake in Global Foundries, and anticipate a rise in the value of their holdings and a revenue stream from dividends if things go well. Building a fab in Abu Dhabi itself is a different matter. Fabs are enormously expensive. Global Foundries exists as a "pure play" fab operator because of that. Fabs are so expensive that few companies can afford to build them. The soaring cost of building fabs is behind outfits like AMD wanting to go fabless, and concentrate on being designers of things others like Global Foundries will actually make. Does it make economic sense to build a fab *in* Abu Dhabi? Who would the customers be? What would the fab make? What would the impact of having the fab halfway around the world from the manufacturers who would actually use what the fab made in products be? The folks in Abu Dhabi may have looked at it, and decided they couldn't get a big enough return to justify the investment. Meanwhile, the question is whether Global Foundries *can* meet it's profitability and IPO targets, but that would be true in any case.



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