In the Chinese calendar, it has been the "Year of the Horse" for most of 2002. Meanwhile, in the semiconductor industry, it was the "Year of Alignment" between silicon foundries and integrated device manufacturers (IDMs) in 2002.

For years, chip makers have been using foundries to manufacturer their products. But in 2002, the soaring cost of fabs, process technologies, and tools prompted IDMs to scramble and form a series of long-term, surprising partnerships with foundries.

In doing so, IDMs and foundries are "aligning" themselves in order to share the costs and risks involved in developing a costly fab and process technology. Chip makers and foundries also hope to be on the same page, when a technology node is up and running for volume production.

The move towards this "alignment" trend prompted several major announcements, which grabbed the headlines in 2002. In March, for example, silicon foundry giant Taiwan Semiconductor Manufacturing Co. Ltd. along with Europe's Royal Philips Electronics N.V. and STMicroelectronics announced a collaboration on a new 90-nm (0.09-micron) CMOS process and plans to jointly develop next-generation 65-nm (0.065-micron) and below technologies. The three partners teamed up to fabricate the test chips in a joint-development pilot line in Crolles, France (see March 5, 2002 story ).

A month later, Motorola Inc. announced it would join the 300-mm wafer-processing R&D alliance between Philips, STMicroelectronics, and TSMC in Crolles. The companies agreed to form a new five-year alliance to jointly pursue processes from the 90-nm to 32-nm nodes in the 300-mm R&D facility (see April 12, 2002 story ).

In 2002, TSMC has also announced separate 90-nm chip outsourcing deals with Agere, LSI Logic and NEC. But not to be outdone, TSMC's rival--Taiwan's United Microelectronics Corp. (UMC)--this year also expanded its "alignment" strategy as well.

In June, UMC, Advanced Micro Devices Inc., Infineon Technologies AG announced major plans to collaborate on a "common" 300-mm, chip-manufacturing platform at the 65- and 45-nm technology nodes. Earlier in the year, AMD and UMC announced a similar 300-mm foundry alliance in Singapore, dubbed AU Pte. Ltd. (see July 29 story ).

But perhaps the biggest surprise of the year was an alliance between IBM Corp.'s Microelectronics Division and Singapore's Chartered Semiconductor Manufacturing Pte. Ltd. The companies plan to work together on 90- and 65-nm logic process technologies for foundry production on 300-mm wafers. Additionally the two companies said they might extend the agreement to cover 45-nm process technology (see Nov. 26, 2002 story ).

"This agreement is intended to help our customers by making our advanced technologies more readily available for use in their applications," said John Kelly, senior vice president and group executive at IBM Technology Group, at the time in a statement.

"Chartered customers gain an enhanced total product solution and earlier access to 90-nm technologies on 300-mm wafers," said Chia Song Hwee, president and chief executive officer of Chartered, in the same statement. "At the same time, this agreement affords Chartered the flexibility to defer the pilot production of our 300-mm Fab 7 until late in the third quarter of 2004, while still meeting our customers' needs and gaining 300-mm manufacturing experience," he said.

(Return to 2002 Top 10 list or go to No. 4).