Category Archives: Top Story Right

March 8, 2012 – BUSINESS WIRE — The HDD industry is rapidly recovering in 2012 and beyond, after surviving natural disasters and tepid market conditions in 2011. According to a report by market research firm TRENDFOCUS, the threat from flash is overblown, and the HDD industry will grow to $48 billion by 2014. 2.3 billion HDDs will ship in the next 3 years for numerous applications and devices.

Also read: HDD rankings: Seagate ousts Western Digital after Thailand floods

According to TRENDFOCUS’ HDD Information Service 2012, the HDD market is surging due to a rebounding supply chain and pent-up demand from virtually all sectors. HDD prices have risen due to tight supply, and pending supplier consolidation (WDC is expected to acquire Hitachi GST) will boost profitability to all-time highs.

“HDDs will remain the king of storage for years, and will coexist with NAND flash in most applications,” stated Mark Geenen, President of TRENDFOCUS. “Global storage requirements are growing more than 40% annually, and demand from both the personal computer market and HDD-enabled CE devices will support tremendous expansion over the coming years.”

Unmet demand, brought on primarily by the late 2011 Thailand floods and deeply affected the supply of HDDs, will continue through 2012 and will keep supply tight.

In 2011 over 335 exabytes shipped – nearly tripling to 960 exabytes in 2014.

A 10X cost advantage favors broad and growing use of HDDs across most compute platforms. In 2012, client computing SSDs will approach $1.00/GB while client HDDs will hover around $0.10/GB even after accounting for HDD unit price increases following the October 2011 Thailand floods.

“Hybrid” and dual-storage devices (combined HDD and SSD) will boost the performance of HDDs to levels similar to those of SSDs in most cases, while providing users with cost-effective, high capacity local storage.

In 2012, there is likely to be just three suppliers (following WDC’s acquisition of HGST): Seagate, WDC, and Toshiba.

“Considering the challenges and opportunities, TRENDFOCUS views the HDD industry’s future positively. Our outlook is for over 830 million HDDs to ship in 2014 a robust 10% CAGR” added Geenen.

Access the report at www.trendfocus.com.

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March 7, 2012 — The gallium nitride (GaN) power semiconductor market is currently small, with only 2 major device suppliers. However, new entrants are ramping to production, silicon-based electronics suppliers developing GaN technologies, and light-emitting diode (LED) makers diversifying capacity to make power electronics, according to Yole Developpement.

Also read: GaN LED market growth starts in 2012

The GaN power device industry generated less than $2.5M (estimated) revenues in 2011, with only IRF & EPC Corp. selling products on the open market. R&D contracts, qualification tests, and sampling buoyed the industry with extra revenue. GaN power device revenues are likely to stay below $10M for devices in 2012, with the rest being made through R&D sales.

While IRF and EPC will remain on top in the near term, several new entrants in the GaN power device sector will transition from qualification to production ramp-up in 2013, possibly taking revenues over $50 million. In 2015, as these new entrants achieve higher volumes and qualified 600V+ GaN devices hit the market, GaN will reach non-consumer applications and grow rapidly. In 2015, 12-15 players will together consume more than 100,000 (6" equivalent) epiwafers.

If GaN is qualified in the electric/hybrid electric vehicle (EV/HEV) sector, GaN device business could top the billion dollar line and the GaN-on-Si substrate market could exceed $300 million in revenues by 2019, explains Dr Philippe Roussel, Business Unit Manager, Power Electronics at Yole Développement. However, it is still unclear how car makers will choose between silicon carbide (SiC), GaN, or established silicon technology.

R&D activities are still fragmented between several substrate options for power electronics: GaN-on-sapphire, GaN-on-SiC, GaN-on-GaN, GaN-on-aluminum nitride (AlN) and GaN-on-Si. GaN-on-Si should take a dominant position, thanks to the availability of6" wafers with >7μm-thick GaN epi and 8" wafers under qualification.

Yole Développement identifies 5 companies positioned on the epiwafer business side and more than 6 GaN device pure-players, and another 15 Si-based power firms developing GaN technology.

LED makers are now looking at GaN power electronics, considering ways to convert existing underutilized LED fab capactity to make power semiconductors or epiwafers. That represents an “epsilon” today, but Yole Développement assumes it may create some waves in GaN industry growth. The two technologies are manufactured with similar processes and are subject to similar market dynamics. GaN epi technology came from the LED industry, while current GaN-on-Si epiwafer work is feeding both industries. Most epiwafer vendors are targeting LED and power segments with dedicated products and offers. Yole expects LED and power electronics manufacturing to become so intertwined in the future that the analysts are grouping them under "GaN device industry."

Figure. GaN device market size and list of applications sectors. SOURCE: Yole Power GaN report, March 2012.

Power device makers usually buy polished silicon wafers, conduct the epitaxy (or buy Si epi-wafers) unless using FZ thin wafers, then process the devices. This model is roughly the same for SiC technology. New GaN producers may not integrate metal organic chemical vapor deposition (MOCVD) GaN epitaxy, instead buying GaN epiwafers and processing them in existing CMOS front-end lines. Alternatively, new entrants could fully integrate the GaN process, from the bare silicon, GaN epi, and front-end fab.

"Power GaN — 2012 edition," a report from Yole Développement, provides a complete analysis of the GaN device and substrate industry in the power electronics field: market forecasts, company involvements, etc.

Companies cited in the report: Aixtron, AZZURRO, BeMiTec, Bridgelux, CamGaN Ltd, Diotec, Dow Corning, Dowa Electronics Materials, Enphase , EPC Corp., EpiGaN, Episil, Fairchild, FBH, Freescale, Fuji Electric, Furukawa, GaN Systems, GLO AB, Global foundries, HelioDEL, Hitachi, III-V Lab, IMEC, Infineon, International Rectifier, Intersil, IQE, Kyma, Lattice Semiconductor, LG Electronics, LG Siltron, Lumileds, MicroGaN, Microsemi, Mitsubishi Electric, Nitek Inc., Nitronex, NTT, NXP, OnSemi, Osram, Oxford Instruments, Panasonic, Plessey Semiconductors, Powdec, Power Integrations, Renesas, Rose Street Lab, Samsung, Sanken Electric, Shimei Semiconductor, Shindengen, Siltronic, Soitec, STMicro, Sumitomo SEI, Texas Instruments, Toshiba, Transluscent, Transphorm, TSMC, Tyndall National Institute, Veeco, Velox, Vishay

Author:
Philippe Roussel holds a PhD in Integrated Electronics Systems from the National Institute of Applied Sciences (INSA) in LYON. He joined Yole Développement in 1998 and is leading the Compound Semiconductors, LED,Power Electronics and Photovoltaic department.

Yole Développement is a group of companies providing market research, technology analysis, strategy consulting, media in addition to finance services. Access reports at www.yole.fr.

Visit the new LEDs Manufacturing Channel on ElectroIQ.com!

March 6, 2012 — The market volume for high-brightness light-emitting diodes (HB LEDs) reached $12 billion in 2011, a 4.3% growth over 2010, reports EPIC, The European Photonics Industry Consortium.

While demand for LED backlight unit (BLU) display systems is still growing, consumption of LED chips not keeping up, as fewer LEDs are needed to realize a BLU than in previous generations. The demand for LEDs to produce edge-lit BLU has peaked and will settle at about 70% of its maximum value in 2010-2011. With average cost per LED also dropping, revenues attributed to LEDs for each display screen are declining rapidly, even as production of BLUs based on LEDs rises through 2014.

Also read: Cheaper LED backlights require LED, plate materials changes

Figure. The EPIC Bellwether Index of key companies is an important indicator of the commercial development of solid-state lighting.

In 2011, the bellwether companies showed varying levels of performance. Aixtron was challenged by scale-back of metal organic chemical vapor deposition (MOCVD) purchases, due to slowing demand in the back lighting market and the end of purchase subsidies by the Chinese government. LED chip manufacturers like EPISTAR and Cree showed mixed results, while lighting systems companies like Philips and Zumtobel fared very well.

This data, as well as more on the response of the lighting and display industries to one of the most difficult economic crises in recent years, is presented in a new report from EPIC, LEDs: The 2011 Market Review. HB-LED and OLED unit production figures as well as revenues are detailed for major players around the world for the 2-year period of 2010 and 2011. The report is distributed exclusively to EPIC members.

EPIC is a leading European photonics industry association. Internet: www.epic-assoc.com.

Visit the new LEDs Manufacturing Channel on ElectroIQ.com!

March 6, 2012 — Semiconductor fab equipment spending will remain flat (0% increase) in 2012, shows SEMI’s World Fab Forecast report. But look for a record spend from semiconductor makers in 2013, jumping from $38.85 billion spent in 2012 to $45 billion in 2013.

Eight companies, including Samsung and Intel, will keep their fab equipment spending level above $2 billion in 2012. Key spenders increased their 2012 capex budgets, pushing SEMI’s year forecast from negative to flat. Samsung plans to spend at least $41.4 billion overall, with a hefty amount going to capex; Hynix increased spending in 2012 by 23% ($3.75 billion planned); UMC increased spending from to $2.0 billion; Intel increased spending to a historic high of about $12.5 billion.

If macroeconomic factors improve and other companies adjust their capex plans as well, then equipment spending for 2012 could cross into positive territory.

Table. Fab equipment spending (new and used). Figures in US$ Million. Source: SEMI World Fab Forecast February 28, 2012 edition.
  2008 2009 2010 2011 2012 2013
Semis, discretes, and LED $25,960 $14,446 $33,568 $38,965 $38,850 $45,498
Change % -32% -44% 132% 23% 0% 17%
300mm only $22,473 $12,031 $26,058 $29,986 $34,270 $40,580
Change % -28% -46% 117% 15% 14% 18%

Spending will rise in 2013, especially from Foundry, System LSI, MPU and NAND sectors. The trend is toward fab upgrades to manufacturing leading-edge semiconductors, while a few are also ramping up fab capacity. Coming out of the downturn from 2010 on, yearly capacity growth is 5-10%, remaining low for the foreseeable future. However, SEMI’s fab data shows rapid increases in fab equipment spending for some segments, leading also to an increase in installed capacity. SEMI expects 192 semiconductor manufacturing facilities will invest in equipment in 2012 (latest World Fab Forecast, February 28, 2012).

While installed capacity for DRAM is expected to level out, Flash capacity is growing rapidly between 2010 and 2013. The dedicated foundry sector will also undergo growth in installed capacity with the key contributors like TSMC, Globalfoundries and UMC.

2011 was a strong year for fab construction, with a 24% increase over a decent 2010 to $6.4 billion. This area will fall off in 2012, with a decline of about 28% to $4.5 billion. Data of the World Fab Forecast show an even further decline in 2013.
 
Lower construction spending compared to recent years, especially on new fabs, raises some concern about available capacity beyond 2013. Overall, the industry has tried to control installed capacity since coming out of the 2009 downturn. Now due to increasing demand, some segments, such as Flash, Foundry, and System LSI, are experiencing a boost in installed capacity.

The SEMI World Fab Forecast uses a bottom-up approach methodology, providing high-level summaries and graphs; and in-depth analyses of capital expenditures, capacities, technology and products by fab. Additionally, the database provides forecasts for the next 18 months by quarter. SEMI’s Worldwide Semiconductor Equipment Market Subscription (WWSEMS) data tracks only new equipment for fabs and test and assembly and packaging houses. The SEMI World Fab Forecast and its related Fab Database reports track any equipment needed to ramp fabs, upgrade technology nodes, and expand or change wafer size, including new equipment, used equipment, or in-house equipment. The recently released SEMI Fab database report enables data analysis by technology node, product type, region, company and fab by fab. Access the report at www.semi.org.

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March 5, 2012 — New micro electro mechanical system (MEMS) thermopile players and applications are boosting market growth for infrared (IR) detectors, finds Yole Développement in its new report "Infrared Detector Market, Applications & Technology Trends."

Traditionally, a few players have dominated the business specially for motion detection: Perkin Elmer (which sold its IR detector branch that became Excelitas), Nicera, Murata, and Heimann. Some niche players (Pyreos, Irisys) have also developed innovative pyroelectric technologies (thin film, ceramic hybrid) that enable arrays of sensitive elements, but the volumes sold are still limited to niche markets (counting people, gas detection, spectroscopy).

Large MEMS manufacturers are entering the IR detector business: Texas Instruments, Omron, Panasonic, and Hamamatsu. These companies, boasting substantial revenues and resources, develop thermopile detectors manufactured on large MEMS production lines (6 to 8" wafers). This brings fab costs down, opening up new applications, like the temperature measurement function Texas Instruments (TI) supplies for notebooks, tablets, and other portable consumer electronics.

Figure. IR detector market forecast 2010-2016. SOURCE: Infrared Detector Market, Applications & Technology Trends report, January 2012, Yole Développement.

IR detectors enable motion detectors for applications like lighting controls and alarms. 150 million units were sold in 2010, with low average selling prices (<$1). This mature market will grow at a significant rate (CAGR 2010-2016 in value: +9%), driven by concern for energy savings in buildings, said Yann de Charentenay, senior analyst. IR detector technology will increasingly be used to automatically power on and off lighting, and home appliances such as HVAC and TVs.

IR detectors also are used for non-contact temperature measurement in human ear thermometers, industrial pyrometers, and other applications. They also can detect gas and fire, or analyze materials. Detectors in these applications can cost anywhere from a single dollar to tens of dollars each. These usage sectors are growing, offering robust non-contact measurement with a long lifetime. These applications use small detectors with 1-4 IR-sensitive elements that can be made with pyroelectric sensors or thermopile sensors.

Large detectors (from 16 x 16 to 64 x 64 pixels) are developed to obtain advanced person detection functionalities meaning it is possible to locate the position of a person precisely in a space, to identify immobile persons (not possible with motion sensors) or to monitor large areas. The end markets will be for home automation, healthcare, or security businesses. Pyroelectric, thermopile, and microbolometer technologies all suit this space. Pyroelectric and thermopiles are mature technologies, but for smaller detectors. Microbolometer technology is leading the 10K+ pixel resolution infrared imager business, at prices of several hundred dollars. Microbolometer players (Ulis, FLIR, NEC, DRS) have started to develop or investigate large detector applications, but the low cost target will present a challenge. Expect the dominant technology to emerge next year, forecasts Wenbin Ding, Technology & Market Analyst, MEMS Devices & Technologies.

Also read: Wafer-level packaging emerges for uncooled IR imagers

With the arrival of new MEMS players and the emergence of large detector applications, Yole Développement expects that the overall IR detector business will grow from $152 million in 2010 to $286M in 2016, a 5-year CAGR of 11%.

Companies cited in the report: 3S pocketnet, Agilent, Ametek, BAE , Bosch security, Cerberus, CSST, Delphi, Dias Infrared, DRS, Dostmann, E+e, Excelitas, FLIR, Fluke, Fuji Piezo, G&E, Hager, Hamamatsu, Heimann, Heitronics, Honeywell security, ICX FL IR, Infratec, Intex, Irisys, Korea digital, L3com, Land, Legrand, Leister Axetris, Lumasense ITC, Melexis, Memstech – Ann Arbor, Merten, Mitsubishi Electric, Murata, NEC Avio, Nicera, Omega, Omron, Panasonic, Perkin Elmer, Pyreos, Raytheon, Ritsumeikan University, Samsung, SCD, Schneider Electric, Selex galileo, Sensair, Senseair, Sensource, Shimadzu, Somfy, Sony, Symetrix, Telaire, Texas Instrument, Thermofisher, Tyco security, Tyndall, Ulis, UTC fire & security, Visonic, Winsen, Wuan Cubic, Yongsheng, ZB sensor.

Report authors:
Yann de Charentenay, Senior Analyst covers MEMS, materials and compound semiconductors.

Wenbin Ding is a Technology & Market Analyst at Yole Développement, specializing in MEMS Devices & Technologies.

Yole Développement is a group of companies providing market research, technology analysis, strategy consulting, media in addition to finance services. Access the report at www.yole.fr.

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March 5, 2012 — The Semiconductor Industry Association (SIA) reports worldwide semiconductor sales of $23.1 billion in January 2012, a 2.7% decrease from the month prior, in line with seasonal patterns. The figure was an 8.8% decrease year-over-year, but SIA expects positive demand as 2012 progresses.

All monthly sales numbers represent a 3-month moving average.

Table 1. Month-to-Month Semiconductor Sales (USD Billions)
Market Last Month Current Month % Change
Americas 4.36 4.31 -1.1%
Europe 2.78 2.77 -0.5%
Japan 3.59 3.44 -4.2%
Asia Pacific 13.10 12.66 -3.4%
Total 23.83 23.18 -2.7%
Table 2. Year-to-Year Semiconductor Sales (USD Billions).
Market Last Year Current Month % Change
Americas 4.69 4.31 -8.0%
Europe 3.30 2.77 -16.2%
Japan 3.80 3.44 -9.4%
Asia Pacific 13.63 12.66 -7.1%
Total 25.41 23.18 -8.8%

 

Table 3. Three-Month Moving Average Semiconductor Sales (USD Billions).
Market Aug/Sep/Oct Nov/Dec/Jan % Change
Americas 4.67 4.31 -7.6%
Europe 3.08 2.77 -10.3%
Japan 3.88 3.44 -11.4%
Asia Pacific 14.17 12.66 -10.7%
Total 25.81 23.18 -10.2%

"A weakened global economy amidst inflation concerns and the European debt crisis continued to affect sales at the start of the year, but there are strong signs pointing to recovery and growth as 2012 progresses," said Brian Toohey, president, Semiconductor Industry Association. Semiconductor sales are expected to improve due to positive demand drivers, an improved U.S. economic outlook, and the resolution of flood-related disruptions in Thailand.  

Analysts at Barclays Capital continue to look for 1Q12 to mark the inflection: Average guidance from semi makers is -3.5% at midpoint, supported by 5-8% average Q/Q CAGR for revenues in 2Q-4Q12 (6-10% ex-Memory). Barclays continues to model semi revenues as flat to 4% growth in 2012. Barclays analysts are "hard pressed to model faster growth for semis," with such gradual macro economic recovery.

Also see: Record semiconductor sales in 2011, 2012 outlook

Figure. Worldwide semiconductor revenues. SOURCE: WSTS.

"While data across all sub-segments came in worse versus December on a Y/Y basis; M/M revenue trends were in line with normal seasonality," noted Barclays. Trends appear worse on a Y/Y basis — there were deteriorating Y/Y trends in the month of January with the rate of decline faster versus December.

Despite recent WSTS membership changes, SIA will continue to publish WSTS data according to the established schedule, relying on accurate and timely data, the association noted. The Semiconductor Industry Association, SIA, a representative of the US semiconductor industry, unites over 60 companies that account for 80% of domestic semiconductor production. Learn more at www.sia-online.org.

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March 2, 2012 — Test equipment supplier Multitest launched a new Quad Tech contactor, the Triton contactor, for high-end digital test applications such as server, computer, mobile smartphone, digital TV, and graphics chips.

The Triton contactor is designed for these large-array, highly integrated semiconductor packages with high I/O count and many high-speed differential I/Os. It eliminates contactor bowing, limited compliance and test handler force limitations by offering an enhanced compliance window to accommodate stack height variations, an optimized force to support large BGAs and LGAs and multisite package test. It uses up to 20GHz differential bandwidth.

The Triton was successfully evaluated at high-volume production. Multitest has received several re-orders for the contactors.

Multitest is a designer and manufacturer of final test handlers, contactors and load boards used by integrated device manufacturers (IDMs) and final test subcontractors. For more information about Multitest’s Triton contactors, visit www.multitest.com/Triton.

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March 2, 2012 — The International Solid State Circuits Conference (ISSCC) took place in San Francisco the week of February 20. The best and brightest minds in semiconductors met to share the results of the past year’s research and development efforts. From a memory perspective, this show contained some highly interesting presentations.

Also read: ISSCC round-up – 2.5D packaging for IVRs, smallest NAND flash chip, more

Eli Harari keynote
The three-day conference began with a keynote speech by Eli Harari, retired chairman of SanDisk. He recounted the history of flash memory, weaving in other related insights.

Although both NOR and NAND flash are now a part of everyday life, Harari reminded us that Toshiba’s Fujio Matsuoka invented NAND flash only 25 years ago, in 1987, three years after he invented NOR flash. NAND yielded a memory cell very close to the theoretical smallest size of 4f² but had some very undesirable side effects of serial access and high error rates, so it needed to be coupled with the intelligence to get past these limitations. Harari noted that Matsuoka is an “Out of the Box” thinker.

Harari went on to say that nobody expected for NAND flash to work and looked upon it as a “crazy idea.” It was a solution looking for a problem. One very significant concern was that the memory chip couldn’t stand on its own as did most other memory chips, and what Harari calls “Assisted NAND” was needed. This was a NAND chip coupled with a controller to perform error correction, wear leveling, and bad block management.

When SanDisk started to use NAND, the controller overhead was so great the company was ridiculed by its competitors. SanDisk stood its ground and, eventually, assisted NAND prevailed.

As a dramatic demonstration, Harari pointed out that, using today’s NAND flash technology, a 64GB microSD card provides about 6 Terabytes per cubic inch. He told the audience that this bit density would allow the entire US Library of Congress to be contained in about 1.5 cubic inches (55cc).

Harari thanked Toshiba for not abandoning NAND in its early days when few believed in the semiconductor technology. He remarked that the Toshiba/SanDisk joint venture has been one of the most successful in the history of semiconductors, and now supplies roughly 40% of the world’s NAND flash.

The presentation lit upon several historical landmarks and a number of humorous twists, the most important of which were the life lessons from an undisputed leader in the industry: Stick to your convictions, especially when your gut instinct tells you that you’re right. Perseverance in the face of naysayers really does pay off.

Harari’s keynote had the rapt attention of everyone in the room.

DRAM session
Samsung showed a 39nm 4Gb DRAM in a presentation that highlighted the clock circuitry. A very sophisticated DLL was used that had a switchable linear or digital delay line depending on the clock frequency. Internal error correction included parity on the address and command lines and a cyclic redundancy code (CRC) on the data. The company also presented an LP-DDR3 device that offers double the bandwidth of LP-DDR2 at the same voltage. The process for this part was not disclosed.

Hynix presented a 1.2V 38nm 2Gb DDR4 DRAM with a die size of only 43.15mm². The power consumption was roughly 50% lower than that of the chip’s DDR3 counterpart, even though the new chip’s core frequency is the same as the DDR3 part. Hynix also presented a DDR3 DRAM that uses a 23nm process to produce a 30.9mm² chip — the smallest die size ever reported for this density. Hynix brought also a special clocking circuit for through silicon via (TSV) DRAM interfaces that uses sophisticated logic to align the clock with data from all the chips in a multi-chip stack.

Although this was not the nonvolatile session, Samsung presented a phase-change random access memory (PRAM) that had a high bandwidth despite its large cell size of 7f². Novel approaches shortened the program time of this 29nm process chip.

There were two university papers, from Keio University and the University of West Virginia. Keio showed an innovative non-contact memory bus configured to eliminate capacitive loading concerns, and University of Virginia communicated over a wired channel using two different frequency bands to support simultaneous transmission and reception of data.

Nonvolatile memory (NVM) advances
Both Toshiba and SanDisk presented papers on the two companies’ 128Gb NAND chip that uses three-bit cells and a 19nm process to achieve the smallest die size (170.6 mm²) for a chip of this density. This device uses some exotic techniques, like air gaps to lower the bitline RC time constant, and an internal temperature sensor, both of which help to keep the speed similar to devices processed on less aggressive geometries.

The University of Tokyo presented a very sophisticated SSD controller that not only corrected NAND bit errors based on the chip’s layout, but also used special reprogramming techniques to restore bits to their original value after they may have been corrupted by adjacent cell disturbances.

The Korea Advanced Institute of Science & Technology (KAIST) also presented a controller that used a high-speed multithreaded encoder/decoder with multiple ECC engines to provide error correction and flash management at enterprise SSD speeds.

Samsung presented a "sub-20nm" NAND flash, but the speaker was caught in a difficult position by the corporate dictum that Samsung’s management would not allow him to disclose the true process geometry while audience members demanded it. This caused an unusual disquiet in the room.

Panasonic spoke about a crosspoint resisitance RAM (ReRAM) that solved many difficulties through the novel use of a very simple back-to-back Zener diode structure to select the cells while allowing the bidirectional current flow required to achieve cell programming. More detail on this approach is given at http://thememoryguy.com/how-do-you-make-an-reram-work/

TSMC also presented an ReRAM, focusing on the sub-0.5 Volt sense amplifier — a first for a memory chip.

Conclusion
As happens every year, ISSCC included several intriguing papers that showed not only directions that the market is heading, but also the challenges confronting chip makers as we approach the end of scaling for both NAND and DRAM.

Jim Handy is an analyst at Objective Analysis, which offers third-party independent market research and data for the semiconductor industry and investors in the semiconductor industry. He has over 35 years in the electronics industry including 20 years as a leading semiconductor and SSD industry analyst. Early in his career he held marketing and design positions at leading semiconductor suppliers including Intel, National Semiconductor, and Infineon. Learn more at http://www.objective-analysis.com/

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February 27, 2012 — Elpida Memory Inc. (Tokyo: 6665) resolved to file a petition for the commencement of corporate reorganization proceedings at today’s meeting of the board of directors, and filed the same with the Tokyo District Court. Elpida’s consolidated subsidiary, Akita Elpida Memory Inc., also saw the commencement of corporate reorganization proceedings, and there is a possibility that claims against the said company may not be collected. Nikkei called the bankruptcy protection filing "the largest corporate failure among Japan’s manufacturers since the end of World War II" (Dow Jones, http://e.nikkei.com/e/fr/tnks/Nni20120227D27JF576.htm).

Tokyo District Court has immediately rendered the temporary restraining order to restrain any repayment, etc., the comprehensive prohibition order to prohibit any execution and the supervision and examination order. Under the court’s supervision and Atsushi Toki, Attorney-at-Law and the Supervisor and Examiner appointed, Elpida will begin to rebuild its business. The company stated, "If we continue the business by ourselves, we will face cash shortage soon. Moreover, we assumed that, if we left this situation and then cash shortage would become reality, the corporate value of our company must significantly fall, there must be no way to be supported by any sponsorship, and the people concerned such as the creditors must suffer more inconvenience. Therefore, we are obliged to decide that we will aim for the restructuring of our business under the proceedings of the Corporate Reorganization Act and filed the petition as of today."

The filing ends "prolonged speculation" about how Elpida was going to raise enough funds to repay large loans due from April. Elpida’s debts amounted to 448.03 billion yen as of March 31, 2011, reports Nikkei. Elpida’s 2011 IC sales were down 39%, dropping it 6 spots in the rankings, according to a recent IC Insights report.

Elpida was established in December 1999 to make dynamic random access memory (DRAM) semiconductor chips in Japan (initial trade name was NEC Hitachi Memory Inc. until 2000), with development operations for DRAM products since April 2000. Elpida expanded into foreign markets and was listed on the Tokyo Stock Exchange in November 2004. It established a joint venture company, Tera Probe, Inc., specialized in wafer probe testing, in 2005. Other businesses of Elpida include Akita Elpida Memory, Inc., a wholly owned subsidiary to take on the back-end process for DRAM and Rexchip Electronics Corporation, a joint venture company for front-end process that was subsequently acquired as a subsidiary.

"Elpida, while strong technically, has suffered because of the 2011 DRAM price collapse and Japan’s strong yen," report Jim Handy and Lane Mason of Objective Analysis.

Elpida has a wafer fab in Hiroshima, Japan and one (the Rexchip fab) in Taiwan; both are 300mm and each have 100,000 wafers per month (WPM) capacity. "Elpida could sell off some of its assets, potentially the Hiroshima fab, to pay off creditors and even sell some additional 300mm fab equipment," theorized Sterne Agee’s Vijay Rakesh and Mark Kelley.

Elpida cites sluggish DRAM growth in personal computers, as well as an increase of the capacity of DRAM per unit, for its overcapacity after 2006-2007 capital expenditures on wafer fabs and equipment. "At the beginning of 2007, the price of DRAM started falling sharply and, combined by a significant decrease of demand for the products due to the global economic downturn begun in the fall 2008, such price further declined. In the fiscal year ended March 2009, we were forced to experience a significant deterioration in business results compared with the previous year," Elpida’s statement reads. Objective Analysis does not expect a supply/demand balance in the overall DRAM marketplace until 2013, or possibly later if NAND gains share in PCs.

DRAM chip prices may rise in the near term after Elpida filed for bankruptcy protection, Taiwanese memory chip vendors said. The remaining players in the DRAM market will benefit from reduced supply with a boost in pricing and revenue in H2 2012, according to the IHS iSuppli Memory & Storage Service. IHS conservatively estimates that 2012 DRAM revenue will exceed $30 billion, compared to the previous forecast of $24 billion.

Figure. If more than 25% of Elpida’s manufacturing capacity is taken offline, the global average selling price (ASP) for all DRAM shipments is projected to rise to $1.21 by the end of 2012, up 15.5% from $1.05 at the end of H1. The figure shows global ASP for all DRAM shipments (global DRAM revenue divided by gigabit shipments). SOURCE: IHS iSuppli Research.

Related stories: SMIC, Elpida settle 200mm wafer claims and Elpida shifting output to Taiwan, blames yen and ASPs

In June 2009, Elpida received an approval on the business restructuring plan under the Act on Special Measures Concerning Revitalization of Industry and Innovation of Industrial Activity from the Ministry of Economy, Trade and Industry in order to maintain superiority in technology and to increase the productivity. Japan’s trade and industry minister Yukio Edano called the 2009 bailout decision a "sensible one," but noted that this time "things are different," Nikkei reports, http://e.nikkei.com/e/ac/tnks/Nni20120227D27JF580.htm. Today, circumstances are worse for Elpida with a strong yen against the US dollar and the steep fall of the price of DRAM products with fierce competition in the DRAM industry. DRAM demand also stagnated due to the great flood in Thailand in 2011.

Given that Elpida has already established itself as a major DRAM suppler for smartphones and tablets, if the Japanese vendor exits the market, only Samsung Electronics Co. (KSE:005930) and Hynix Semiconductor Inc. (KSE:000660) will remain in the mobile DRAM market, resulting in a DRAM oligopoly, hypothesized TrendForce in a new report.

Akita Elpida was established in July 2006 as a wholly owned subsidiary of Elpida, taking over the semiconductor backend process businesses from Akita Electronics Systems Co. Ltd. and Akita Semiconductor Co. Ltd., a subsidiary of Akita Electronics, both of which were Hitachi Ltd. group companies. Akita Elpida has so far collected its claims for accounts receivable of approximately 700 million yen from Elpida monthly. However, now that facing the situations that Elpida is set to rebuild and the collection of the accounts receivable has become difficult, and as a result of which the prospect of its future financing has become uncertain, Akita Elpida has decided to rebuild its business pursuant to the procedures under the Corporate Reorganization Act. The total amount of liabilities (Balance sheet as of March 31, 2011) is 7,961 million yen.

Powerchip is a DRAM foundry for Elpida in Taiwan, and Elpida’s bankruptcy could mean further ripple effects, warned Sterne Agee’s analysts. Elpida’s bankruptcy could further cut 2012-13 DRAM equipment capex and the capex of OEM-foundry partners.

Of the remaining DRAM manufacturers, Micron is the only one that is likely to take over other companies’ DRAM businesses, asserts Objective Analysis, noting that Hynix and Samsung build all their own capacity. Taiwan’s DRAM players are in a position similar to Elpida’s, and more consolidation or similar drastic actions could occur soon in Taiwan’s biggest three DRAM makers: Nanya, Powerchip, and ProMOS.

Learn more at Elpida Memory’s news page, http://www.elpida.com/en/news/index.html.

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March 1, 2012 — OSRAM Opto Semiconductors released the Oslon SSL LED, using optimized LED chips and packaging technologies to boost light output, with a 25% efficiency increase over previous-generation LEDs. OSRAM stabilized the LED’s luminous flux at elevated temperatures, which simplifies luminaire design by improving thermal management. The LED chip is 1mm2, in a 3mm2 package form factor.

The temperature-stable light source generates a luminous flux of typically 98lm (luminous efficacy of 96lm/W) in warm white (3,000 K), with an operating current of 350mA at 85°C in the chip. This, coupled with reduced forward voltage (3.1V), achieves the 25% efficiency gain, and reduces the thermal management requirement for the chip. A smaller number of Oslon SSL LEDs provides the same luminous flux in a luminaire.

Thanks to the reflectivity of the package, the light that is irradiated to the side or to the back is reflected and can be used again.

The LEDs are available in warm and cool white, and two different lenses.

OSRAM AG (Munich, Germany) is a wholly-owned subsidiary of Siemens AG and a leading light manufacturer. Its subsidiary, OSRAM Opto Semiconductors GmbH, offers semiconductor-technology-based products for lighting, sensor and visualization applications. For more information, go to www.osram-os.com.

Visit the new LEDs Manufacturing Channel on ElectroIQ.com!