January 3, 2007 – With a record 29 fabs set to come online and ramp to mass production, the stage is set for a banner year in capital spending in 2007, according to Strategic Marketing Associates.

Companies including Micron, AMD, TSMC, SanDisk, Inotera, and ProMOS have already said they will increase their capex budgets in 2007, Burns noted. So, “it’s almost inevitable that capital spending will grow this year.”

Capital spending should rise about 10% this year to top $60 billion, the second-highest level ever, following better-than-expected 15% growth in 2006, according to SMA president George Burns. “We said [in December 2005 that] the increase in capital spending would be fab driven, and it will be fab driven in 2007 as well,” he said, in a statement.

The key to another double-digit growth increase will be new fabs coming online. Burns expects as many as nine new DRAM fabs will sprout up this year, with projects from Powerchip, TECH Semiconductor, ProMOS, Samsung, Nanya, Inotera, Hynix, and Winbond. Meanwhile, $8.5 billion worth of new microprocessor fabs will come online from Intel and AMD, and another $4.5 billion for new flash memory, and almost $4 billion in foundry facilities. The total value of fabs coming online when fully equipped will exceed an eye-popping $44 billion, he added.