CHIP MAKERS FEEL CHANGE IN SEMICONDUCTOR BUSINESS

July 14, 2000

COMMERCIAL NEWS

Taipei, TAIWAN — Michael Kramer reports that from their perch at the top of the semiconductor production chain, microchip makers are feeling a sea change come over the business as silicon moves beyond computers and permeates daily life.

Executives at foundry firms, which make chips to the designs of client companies, say the semiconductor upturn that began in 1999 has taken a more promising path than past boom-and-bust cycles thanks to Internet and telecom demands.

“As soon as we start saying it’s different, we’re in trouble – we’ve overstated our outlook,” cautioned Ron Norris, senior vice president of sales and marketing at Taiwan Semiconductor Manufacturing Co (TSMC), the world’s largest maker.

“But the breadth of the drivers seem much more significant today,” he admitted. “There really does seem to be some level of pervasiveness in this cycle.

“Semiconductor cycles have classically not been in sync with worldwide economic cycles, but we are becoming much more tightly coupled with the consumer,” he told Reuters.

Communications chips accounted for 38 percent of TSMC’s output in the first quarter of 2000, against 33 percent in the third quarter of 1999.

Down the street in Taiwan’s Hsinchu Science-based Industrial Park, TSMC’s arch-rival United Microelectronics Corp (UMC) says communications chips now account for 35 percent of output, up from five percent a few years ago.

Peter Chang, UMC’s chief executive of foundry operations, predicted another three to four years of growth in the chip industry thanks to “a new kind of demand” from consumer products such as mobile phones.

“The beauty of this demand is that it’s like a fashion thing,” Chang said. “People keep on changing their phone. I’ve changed three phones already this year.

“The worst thing is if a product last forever,” he added.

Beyond mobile phones however, foundry executives agreed that new applications such as wireless home networking, the consistent need for Internet infrastructure and the myriad new devices that can surf the web will all drive demand for chips.

“You see a huge demand for the 56k modem or the ADSL modem all the way back to central office switching for a tremendous amount of more bandwidth,” said Kevin Meyer, vice president of business development at Chartered Semiconductor, the world’s third largest foundry.

“That need of bandwidth is certainly driving some exciting new markets,” he told Reuters by telephone from Chartered’s Singapore headquarters.

Higher proportions of communications sales do not just reflect a market trend, however. Foundries have actively courted these firms because of their growth potential and their preference for higher-end designs – which yield higher margins for the manufacturer.

UMC’s Chang said he expected communications clients to migrate completely from 0.35 micron technology to 0.25 micron technology, cramming more transistors on each chip, by the end of the year.

At Chartered, attracting communications customers was part of a makeover that turned the former loss-making company into one of the island’s hottest stocks.

“Over the last year and half, almost two years, we’ve had a very conscious strategy of moving away from the commodity kinds of applications that tend to be memory-focused,” Meyer said.

“So what we’ve seen is that our mix has moved from a commodity memory, PC-centric mix to a more of a communications mix where over half of our sales come from the communications market segment,” he said.

But all this new demand has caused a desperate capacity shortage at chip foundries, making for tough choices between a deluge of orders from both promising new customers and faithful old ones.

“It’s a tough time in the industry overall, in that when you see companies coming in and upsiding their forecasts by three times what they were telling you six months ago, we’re not always able to meet everybody’s expectations,” Meyer said.

UMC’s Chang said his foundry copes with the problem by allowing old, computer-related clients to keep their allocations of precious capacity, but giving new growth over to clients judged to be high-premium and high-potential.

And a lot of new growth is coming on line at UMC. The foundry is in the process of ramping production at two new wafer fabrication plants, and expects monthly output to hit 200,000 eight-inch silicon wafer equivalents by the end of the year, up from 180,000 a month at present.

Norris said TSMC also preferred clients that were seeking to push their microchip performance to the technological edge, no matter what type of products they made. He had little patience for companies that were simply short of their own capacity and hoping to rent some from TSMC.

“We don’t spend much time at TSMC talking to those opportunities. They’re just not interesting to us,” he said.

“The opportunities that are interesting to us are like the ones our Mortorola relationship is characteristic of, where they are trying to address this market trend,” Norris said.

“It’s characterised by what’s happening in communications, in consumer, and really, the other areas of high-performance computing.”

============================================================

Subscribe to HPCwire's Weekly Update!

Be the most informed person in the room! Stay ahead of the tech trends with industry updates delivered to you every week!

MLPerf Inference 4.0 Results Showcase GenAI; Nvidia Still Dominates

March 28, 2024

There were no startling surprises in the latest MLPerf Inference benchmark (4.0) results released yesterday. Two new workloads — Llama 2 and Stable Diffusion XL — were added to the benchmark suite as MLPerf continues Read more…

Q&A with Nvidia’s Chief of DGX Systems on the DGX-GB200 Rack-scale System

March 27, 2024

Pictures of Nvidia's new flagship mega-server, the DGX GB200, on the GTC show floor got favorable reactions on social media for the sheer amount of computing power it brings to artificial intelligence.  Nvidia's DGX Read more…

Call for Participation in Workshop on Potential NSF CISE Quantum Initiative

March 26, 2024

Editor’s Note: Next month there will be a workshop to discuss what a quantum initiative led by NSF’s Computer, Information Science and Engineering (CISE) directorate could entail. The details are posted below in a Ca Read more…

Waseda U. Researchers Reports New Quantum Algorithm for Speeding Optimization

March 25, 2024

Optimization problems cover a wide range of applications and are often cited as good candidates for quantum computing. However, the execution time for constrained combinatorial optimization applications on quantum device Read more…

NVLink: Faster Interconnects and Switches to Help Relieve Data Bottlenecks

March 25, 2024

Nvidia’s new Blackwell architecture may have stolen the show this week at the GPU Technology Conference in San Jose, California. But an emerging bottleneck at the network layer threatens to make bigger and brawnier pro Read more…

Who is David Blackwell?

March 22, 2024

During GTC24, co-founder and president of NVIDIA Jensen Huang unveiled the Blackwell GPU. This GPU itself is heavily optimized for AI work, boasting 192GB of HBM3E memory as well as the the ability to train 1 trillion pa Read more…

MLPerf Inference 4.0 Results Showcase GenAI; Nvidia Still Dominates

March 28, 2024

There were no startling surprises in the latest MLPerf Inference benchmark (4.0) results released yesterday. Two new workloads — Llama 2 and Stable Diffusion Read more…

Q&A with Nvidia’s Chief of DGX Systems on the DGX-GB200 Rack-scale System

March 27, 2024

Pictures of Nvidia's new flagship mega-server, the DGX GB200, on the GTC show floor got favorable reactions on social media for the sheer amount of computing po Read more…

NVLink: Faster Interconnects and Switches to Help Relieve Data Bottlenecks

March 25, 2024

Nvidia’s new Blackwell architecture may have stolen the show this week at the GPU Technology Conference in San Jose, California. But an emerging bottleneck at Read more…

Who is David Blackwell?

March 22, 2024

During GTC24, co-founder and president of NVIDIA Jensen Huang unveiled the Blackwell GPU. This GPU itself is heavily optimized for AI work, boasting 192GB of HB Read more…

Nvidia Looks to Accelerate GenAI Adoption with NIM

March 19, 2024

Today at the GPU Technology Conference, Nvidia launched a new offering aimed at helping customers quickly deploy their generative AI applications in a secure, s Read more…

The Generative AI Future Is Now, Nvidia’s Huang Says

March 19, 2024

We are in the early days of a transformative shift in how business gets done thanks to the advent of generative AI, according to Nvidia CEO and cofounder Jensen Read more…

Nvidia’s New Blackwell GPU Can Train AI Models with Trillions of Parameters

March 18, 2024

Nvidia's latest and fastest GPU, codenamed Blackwell, is here and will underpin the company's AI plans this year. The chip offers performance improvements from Read more…

Nvidia Showcases Quantum Cloud, Expanding Quantum Portfolio at GTC24

March 18, 2024

Nvidia’s barrage of quantum news at GTC24 this week includes new products, signature collaborations, and a new Nvidia Quantum Cloud for quantum developers. Wh Read more…

Alibaba Shuts Down its Quantum Computing Effort

November 30, 2023

In case you missed it, China’s e-commerce giant Alibaba has shut down its quantum computing research effort. It’s not entirely clear what drove the change. Read more…

Nvidia H100: Are 550,000 GPUs Enough for This Year?

August 17, 2023

The GPU Squeeze continues to place a premium on Nvidia H100 GPUs. In a recent Financial Times article, Nvidia reports that it expects to ship 550,000 of its lat Read more…

Shutterstock 1285747942

AMD’s Horsepower-packed MI300X GPU Beats Nvidia’s Upcoming H200

December 7, 2023

AMD and Nvidia are locked in an AI performance battle – much like the gaming GPU performance clash the companies have waged for decades. AMD has claimed it Read more…

DoD Takes a Long View of Quantum Computing

December 19, 2023

Given the large sums tied to expensive weapon systems – think $100-million-plus per F-35 fighter – it’s easy to forget the U.S. Department of Defense is a Read more…

Synopsys Eats Ansys: Does HPC Get Indigestion?

February 8, 2024

Recently, it was announced that Synopsys is buying HPC tool developer Ansys. Started in Pittsburgh, Pa., in 1970 as Swanson Analysis Systems, Inc. (SASI) by John Swanson (and eventually renamed), Ansys serves the CAE (Computer Aided Engineering)/multiphysics engineering simulation market. Read more…

Choosing the Right GPU for LLM Inference and Training

December 11, 2023

Accelerating the training and inference processes of deep learning models is crucial for unleashing their true potential and NVIDIA GPUs have emerged as a game- Read more…

Intel’s Server and PC Chip Development Will Blur After 2025

January 15, 2024

Intel's dealing with much more than chip rivals breathing down its neck; it is simultaneously integrating a bevy of new technologies such as chiplets, artificia Read more…

Baidu Exits Quantum, Closely Following Alibaba’s Earlier Move

January 5, 2024

Reuters reported this week that Baidu, China’s giant e-commerce and services provider, is exiting the quantum computing development arena. Reuters reported � Read more…

Leading Solution Providers

Contributors

Comparing NVIDIA A100 and NVIDIA L40S: Which GPU is Ideal for AI and Graphics-Intensive Workloads?

October 30, 2023

With long lead times for the NVIDIA H100 and A100 GPUs, many organizations are looking at the new NVIDIA L40S GPU, which it’s a new GPU optimized for AI and g Read more…

Shutterstock 1179408610

Google Addresses the Mysteries of Its Hypercomputer 

December 28, 2023

When Google launched its Hypercomputer earlier this month (December 2023), the first reaction was, "Say what?" It turns out that the Hypercomputer is Google's t Read more…

AMD MI3000A

How AMD May Get Across the CUDA Moat

October 5, 2023

When discussing GenAI, the term "GPU" almost always enters the conversation and the topic often moves toward performance and access. Interestingly, the word "GPU" is assumed to mean "Nvidia" products. (As an aside, the popular Nvidia hardware used in GenAI are not technically... Read more…

Shutterstock 1606064203

Meta’s Zuckerberg Puts Its AI Future in the Hands of 600,000 GPUs

January 25, 2024

In under two minutes, Meta's CEO, Mark Zuckerberg, laid out the company's AI plans, which included a plan to build an artificial intelligence system with the eq Read more…

Google Introduces ‘Hypercomputer’ to Its AI Infrastructure

December 11, 2023

Google ran out of monikers to describe its new AI system released on December 7. Supercomputer perhaps wasn't an apt description, so it settled on Hypercomputer Read more…

China Is All In on a RISC-V Future

January 8, 2024

The state of RISC-V in China was discussed in a recent report released by the Jamestown Foundation, a Washington, D.C.-based think tank. The report, entitled "E Read more…

Intel Won’t Have a Xeon Max Chip with New Emerald Rapids CPU

December 14, 2023

As expected, Intel officially announced its 5th generation Xeon server chips codenamed Emerald Rapids at an event in New York City, where the focus was really o Read more…

IBM Quantum Summit: Two New QPUs, Upgraded Qiskit, 10-year Roadmap and More

December 4, 2023

IBM kicks off its annual Quantum Summit today and will announce a broad range of advances including its much-anticipated 1121-qubit Condor QPU, a smaller 133-qu Read more…

  • arrow
  • Click Here for More Headlines
  • arrow
HPCwire