August 9, 2007 – ProMOS Technologies and Toppan Printing have agreed to collaborate on manufacturing CMOS image sensors (CIS) using Toppan’s proprietary on-chip color filters and microlens technologies. Manufacturing will be done at ProMOS’ 300mm line, Fab 2, in Taiwan’s Hsin-chu Science Park — which will soon become depreciated, which will keep manufacturing costs low for the CIS work, the firms noted.

“The technology alliance with Toppan Printing will not only diversify ProMOS’ product portfolio, but will also build up ProMOS’ internal CIS manufacturing infrastructure,” noted Min-Liang Chen, chairman and president at ProMOS, in a statement.

The Taipei Times noted that ProMOS has been searching for ways to both reduce its exposure to the volatile DRAM market (where ASPs are down 60% this year), as well as utilize older fab operations for CMOS image sensor work. A spokesperson declined to provide detail about how much would need to be invested to upgrade the 300mm site for CMOS sensor production, but told the paper that devices for Toppan will start in 1Q08 at the earliest.

The Taiwan Economic News added that the deal also opens inroads for other Japanese suppliers, and pointed out that the CIS market is getting lots of attention lately. TSMC has a deal with US-based CIS supplier OmniVision, working with TSMC’s chip assembler Xin Tech and sensor chip designer VisEra Tech, while Powerchip has invested in Silicon Optronics Inc. (mostly owned by OmniVision).

The ProMOS-Toppan deal is not seen as a big blow to China’s SMIC, which has been making the image sensors for Toppan since 2004. Digitimes reports that SMIC “is glad” about the Toppan-ProMOS deal, and maintains that its $64M 30-70 Shanghai-based JV with Toppan, TSES, “has been fruitful” since starting production in early 2006.