Asia Focus
05/01/2001
Sparks fly at ISS Japan over national research projects
A panel presentation on Japan's planned new national research projects got a highly critical response from the audience at ISS Japan 2001, as industry executives charged the projects would offer nothing new or strategic to help Japan's semiconductor industry become competitive again.
Panelist Masataka Hirose, a professor at Hiroshima University who will head the government's MIRAI Project, responded heatedly, "Most research proposals and ideas from member Japanese semiconductor houses were indeed very poor, so I made a fresh resolve to decide everything in the MIRAI Project - research topics, budgets, personnel - myself. I myself have ideas regarding low-k, high-k, and other materials."
Another panelist, Dr. Ogirima of Hitachi, a main promoter of the industry-funded Asuka Project, agreed that, "Frankly speaking, the Asuka project will not be strategic or new, because it will intentionally deal only with noncompetitive topics."
Soon after, Hitachi announced it would join the IMEC/Sematech project developing high-k materials for next-generation gate dielectric films, suggesting the company's real expectations for the Japanese projects are not very high.
The issue of how to revive Japan's competitiveness, and what role the government and corporate cooperation should play, was the hot topic of this year's meeting. Sony chairman Nobuyuki Idei, who gave the keynote address, argued that a company's own internal revolution was much more important than expecting the government to help the industry. But since no one company can do it all alone in a new world where the key will be making systems chips for new consumer products for ubiquitous computing on a ubiquitous network, Sony aims to forge "soft alliances" with other companies like "dating without getting married." Still, growth of the Japanese market will depend on government deregulating the information technology industry, and assuring the infrastructure for the broadband Internet network.
Separately, Nippon Foundry president Yukio Sakamoto blasted Japan's high cost infrastructure, excessive government regulation, and high taxes. "We want taxes to be at a level that allows us to be competitive," he complained. "Otherwise we will be unable to invest in Japan but will go overseas instead."
He also claimed his company's 50,000 wafers/month megafab would drastically reduce production costs over the usual industry model of multiple 10,000 wafers/month fabs.
Outlook from Japan: Cloudy
One of Japan's big semiconductor market research firms has a pessimistic view of the market. VLSI Report in Tokyo (no relation to VLSI Research in the US) sees a big decline in 2002 and 2003.
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The Japanese market researchers expect worldwide semiconductor equipment orders will decline 20.2% this year, to $38.7 billion, but total sales show a 14.6% increase in 2001. This year's drop off in orders will mean a big 29% drop in sales next year, down to $35.1 billion. Equipment orders are likely to decline another 31% in 2002 before things pick up in the second half of 2003, on demand for chips for new Internet phones and digital consumer products - and on device makers finally ramping up their 300mm lines. That should create a 67% jump in orders in 2003, leading to a 53.3% jump in sales in 2004, to $50.7 billion. Still, even at these forecast bottoms, the equipment industry will bring in 41% more revenue than it did in 1999.