The Year of Living Dangerously

Here we are at the end of 2002, at pretty much the same point we were at the end of 2001—having survived a very difficult year and assuming/hoping that business would be better by about the middle of the following year. Apparently time has stood still and a year went by without anything happening.

It's not quite that bad, of course. Sure, the semiconductor equipment book-to-bill ratio dove below 1.00 again, meaning basically that equipment sales are dropping. I won't try to say that things are fine — many companies and individuals are still hurting quite a bit.

I think that disaster has been averted, though. There have been dire predictions for more than a year now about major companies going out of business and others being forced to consolidate to survive. This hasn't happened. We have been clever enough as an industry to figure out ways — as painful as they may be — to keep things going. There has been a bit of consolidation, but I would be hard-pressed to name the biggest company in packaging that got “consolidated.” The blockbuster deal hasn't happened. Between cost reductions, clever partnerships, adjustments in focus and some bewildering financial dealings, the industry has been riding it out. A look back at 2002 leaves me impressed with the fighting spirit in the packaging world.

Another positive sign I've seen of elevated maturity in 2002 is a diminished level of irrational bandwagoning. After the opto roller coaster where everyone wanted a piece of that pie, the buzzword this year was China — everyone needed a China strategy. This has developed much more reasonably, though. Companies haven't been shy about announcing a new partner in China, for example, but the announcements on that topic are based on real activity, not just a new spin to a product or service that already exists. Maybe we have learned something about behaving like grown-ups.

Finally, it almost goes without saying that technology advanced as strongly as ever in 2002. A great recent example is LSI Logic's announcement that it has developed silicon processes, design approaches and packaging processes that allow wire bonding on top of active circuitry. If you have control of the silicon layout, you can decrease the die size by a significant amount if you remove the area around the perimeter where wire bond pads normally are placed.

This is an important advance in packaging, and it's encouraging that chip companies are integrating their chip designs with the packaging technology. That's the kind of thing that will help the industry take its next step out of the doldrums.

Thanks for reading,
Jeffrey C. Demmin
[email protected]


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