Intel (Santa Clara, Calif.), for one, is attempting to push the industry towards 450-mm fabs in the 2012 time frame or beyond. As reported, with backing from Intel, chip-making consortium Sematech is devising a plan that will take a more direct path to 450-mm fabs in the future.

But Sematech's recent unveiling of the controversial plan to hasten the industry's move to 450-mm wafers has driven a wedge between the semiconductor equipment community and some chip makers, rekindling the debate over who will fund the development of next-generation fab tools--or whether the shift should in fact proceed at all.

However, in an interview at the company's 45-nm processor launch last week, Otellini said Intel is still "very interested" in moving towards 450-mm fabs as a means to stay on the chip-production cost curve.

Intel, he said, has not set a timetable for the next-generation wafer size. But he said the company would like to work with -- and not against -- the IC-equipment industry in the 450-mm arena. "We have to do it in concert with the equipment industry," he told EE Times.

Many of Intel's key fab-tool providers may end up developing 450-mm gear -- if the industry shifts to the next-generation wafer size, observers believe. Intel's equipment vendors include Applied, ASMI, Hitachi, KLA-Tencor, Nikon, Novellus, Varian, among others.

But it's unclear who will pay for 450-mm tool development. Fab-tool makers are reluctant to pay for most of the 450-mm development; most -- if not all -- vendors see little or no payback in the arena. Tool makers, however, would gladly develop 450-mm technology -- if the chip makers themselves pay for the bulk of the research and development costs.

Over the years, Intel itself has been a big spender for equipment. For example, Intel "pays a lot for 300-mm equipment," said William Holt, senior vice president and general manager of the company's Technology and Manufacturing Group. But in an interview at the event, Holt also dropped hints that Intel would not foot the entire bill for 450-mm tool development.

Holt did say 450-mm would provide a cost benefit for the IC industry. "We need to go to 450-mm," he said.

Meanwhile, at the event, Intel launched its recently-announced 45-nm microprocessor lines. Setting the pace for the semiconductor industry, Intel rolled out the first members of its Penryn family, 16 45-nm processors using new high-k dielectrics to control current leakage.

Other chip makers, including archrival Advanced Micro Devices Inc., are still months away from having a production-ready 45-nm process, and most are not planning on initially using new insulating materials.

The 45-nm chip launch puts Intel "far ahead" of the competition, according to Otellini. In fact, with its new fab and capital efficiency programs in place, Intel is readying a massive shift towards 45-nm chip production.

Intel has no less than four 300-mm fabs in the works, which are capable of 45-nm production. As expected, Intel will initially move into 45-nm production within its D1D fab in Hillsboro, Ore.

Also in the second half of 2007, Intel is expected to move into 45-nm production within its Fab 32 plant in Chandler, Ariz. In the second half of 2008, Intel is projected to ramp up two more 45-nm fabs, including Fab 28 in Israel and Fab 11x in New Mexico.