November 4, 2004 – Two announcements this week signify China’s eagerness to absorb more leading-edge chipmaking technologies — and US chipmakers’ willingness to provide them, despite longstanding policies restricting exports of advanced technologies to the mainland.

SMIC and Texas Instruments Inc., Dallas, TX, plan to develop 90nm process technologies for logic chips, according to media reports. SMIC reportedly has begun procuring equipment, with shipments due in 4Q04; pilot production would begin by 1Q05. The two companies have been working on 130nm process technology for more than a year, with SMIC finishing copper interconnect layers on 200mm wafers after front-end-of-line (FEOL) fabrication at TI’s DMOS5 facility. SMIC’s move to 90nm process technologies comes less than two months after SMIC began ramping volume runs of 0.11-0.10-micron processes for DRAMs (to Infineon and Elpida) in its 300mm facility in Beijing. It also places SMIC about 9-12 months behind other 90nm chipmakers, after trailing by 18 months at the 130nm node.

Meanwhile, Grace Semiconductor Manufacturing Corp. reportedly is in the final stages of talks with an unnamed US chipmaker to transfer development of 0.13-micron process technologies. The Shanghai-based company, which has been working on 0.15 to 0.5-micron technologies through Japanese partners, indicated test production could begin by the end of this year, with volume runs by 2H05. Grace also is projecting a $0.7-$1.0 billion overseas IPO next year to help fund a new 300mm wafer fab.