News
10/01/2001
Report on worldwide CEMS market predicts moderate growth
SAN JOSE, CALIF. - Electronic Trend Publications Inc. (ETP) has recently released the eighth edition of "The Worldwide Contract Electronics Manufacturing Services Market" report, wherein it predicts that "growth will continue, albeit at a more moderate and sober pace for the next several years as outsourcing enters a more mature phase of transition."
Unprecedented growth in 2000, with total revenues in excess of $100 billion, have set the stage for moderate growth in the years that follow. 2001 will reportedly be a year of less than five-percent growth; a strong recovery, however, is anticipated for 2002 and 2003. The industry should achieve a CAGR of approximately 19 percent during the next five years.
Overall, contract electronics manufacturing services (CEMS) accounted for approximately 15 percent of the entire electronics assembly market, representing an increase of more than five percent from the previous year. ETP suggests that "many of the newly implemented outsourcing programs by lagging OEMs, such as
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Alcatel, Lucent, Motorola, Nokia and Siemens, will hit their full potential in the latter part of the forecast period after 2002." New assembly opportunities in the transportation and industrial/medical sectors are expected to materialize soon, as well.
As has been the case in the past, there is a trend of higher growth in demand for complete product manufacture ("box assembly") services than for PCB services. It is projected that, by 2005, nearly 38 percent of all industry revenue will come from box assembly (compared to 30 percent in 2000).
The ETP report also provides data regarding geographic market share (showing North America and Europe as having the most substantial growth), application market share (which indicates that fine-pitch and esoteric packaging technologies for communications, computer and consumer markets will experience high growth), and CM market share (with data indicating that Solectron will likely occupy the number-one spot for the foreseeable future). The report contains sections that detail overall CM performance (not just in terms of revenues, but also in terms of earnings and returns), deeming Jabil Circuit the highest performer. It also reports that CM merger and acquisition activity in 2000 shattered all previous records, with revenue gained from acquisitions in excess of that of the five previous years combined. The largest estimated acquisition in the past four years was the acquisition of Nortel operations by Solectron.
For more information on The Worldwide Contract Electronics Manufacturing Services Market, contact Electronic Trend Publications Inc. at 408-369-7000 or www.electronictrendpubs.com.
Xilinx qualifies Unitive's bumping technology
RESEARCH TRIANGLE PARK, N.C. - Unitive Inc., a provider of wafer-level packaging solutions, has announced that Xilinx Inc. has qualified and is using in production its eutectic wafer bumping technology for Xilinx's Virtex-II FPGA.
"Unitive is committed to mutually beneficial technology partnerships, as is Xilinx," commented Robert Lanzone, vice president of marketing for Unitive. "Our technology helps Xilinx reduce costs and produce a more efficient, faster product. Unitive benefits by having our technology affirmed by one of the leading forces in the semiconductor industry."
Xilinx Platform FPGAs are reportedly the newest and most advanced programmable logic devices in the industry, delivering unprecedented logic, memory and I/O capacity. System designers have increased their use of FPGAs to handle large streams of data in high bandwidth communications equipment and video/imaging applications. Xilinx's Virtex-II FPGA reportedly out-performs its closest competition, offering 45 percent more logic resources and more than 480 percent on-chip RAM.
"Part of Xilinx's future focus is to reduce the cost of our chips in order to gain broader access to high-volume markets," said Erich Goetting, vice president and general manager of the Advanced Products Division at Xilinx.
"Unitive's eutectic wafer bumping technique allows us to do just that - cut down on costs while also giving us the benefit of speed and efficiency."
TMS selected by Raytheon to develop test methodology
SAN DIEGO - Turnkey Manufacturing Solution Inc. (TMS), a multinational company specializing in providing RFIC test services, recently announced that it was chosen by Raytheon to develop the test methodology for Raytheon's Tondelayo Wireless LAN (WLAN) chipset. TMS was chosen because of its high-frequency RFIC test expertise.
The Tondelayo chipset is a fully integrated system designed for the fast growing high-speed wireless market; the chipset is being offered to networking OEMs as a "Complete Radio Solution," based on the IEEE 802.11(a) standards for high-speed wireless networks in the 5 GHz UNII bands.
In developing the Tondelayo chipset, Raytheon has taken a flexible, low-risk design approach to achieve the promise of a full 54 Mbps for reasonable distances and in normal working environments. All of the system's components are designed to work together for maximum interoperability and seamless performance.
According to RF Networking marketing director James Higgins, Tondelayo will provide a cost-effective solution that will facilitate high-speed wireless products in a wide range of markets, including WLAN, networking, residential gateways, and consumer electronics. Raytheon RF Networking's modular chipset approach also offers solutions to prospective clients who seek subsystem components, such as companies in the fixed broadband access market and others seeking an analog subsystem to complement their baseband solutions.
MeltroniX and Hi-Q Materials form alliance
SAN DIEGO - MeltroniX Inc., a provider of high-density semiconductor interconnect solutions, has signed a strategic alliance with Hi-Q Materials Inc., a start-up microelectronic materials company. MeltroniX plans to incorporate Hi-Q technology into high-density interconnect solutions for its customers in the wireless networking, telecommunications, space and medical markets.
"Hi-Q is a pioneer and innovator in advanced microelectronics packaging materials, and MeltroniX is a leader in creating small form-factor solutions for semiconductors," said Andrew Wrobel, CEO of MeltroniX.
"High-speed applications have created the need for improved thermal material performance, and low-cost state-of-the-art technology solutions for high-density interconnect," said David Virissimo, president of Hi-Q Materials.
3M aims to double package performance
AUSTIN, TEXAS - 3M has recently announced an innovation in materials science that is enabling its telecommunications customers to make the leap from OC-192 to OC-768 (or 10 Gbps to 40 Gbps). This proprietary new technology reportedly will also benefit network applications, such as routing and switching, as well as server and workstation applications.
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3M, which provides a wide range of solutions (including both rigid and flexible microinterconnects) to the electronics and telecommunications markets, points out that the required increase in bus speed and width to satisfy the demands of increased data transmission can increase sensitivity to electrical noise, greatly affecting system performance. 3M's new packaging solution responds to these challenges by lowering simultaneous switching output (SSO) noise and core sag, allowing operation of wide (greater than 128 bit) busses with bus speeds in the gigahertz range.
"The industry is hungry for bandwidth and will continue to demand new technologies to enable it to grow. It looks to 3M and our expertise in materials science, high-speed design and manufacturing to satisfy the need for cost-effective, high-performance IC packaging," said Paul Fischer, head of 3M Microelectronic Packaging.
3M Microelectronic Packaging, headquartered in Austin, Texas, provides high-density multilayer inter connects for IC and optoelectronic packaging. Selective prototyping of the new packages is currently under way at 3M's Eau Claire, Wis., microelectronics packaging facility.
Is the freefall slowing down?
Times are tough, and no one is about to argue that point. But recent news from two assembly and test houses seem to reflect trends that are headed in the right direction - declines slowing and businesses stabilizing.
ChipPAC Inc. (Fremont, Calif.) recently announced that it has outperformed other contract chip assembly and testing houses in the second quarter by posting a sequential decline in revenues of just 2.8 percent, as opposed to an average drop of 27 percent by competitors. The company posted a net loss of $7.5 million in the second quarter, compared to $2.8 million in the same period last year.
ChipPAC reported that its total packaging unit volume for the second quarter was 407.9 million devices - a one-percent decrease from Q2 last year and a four-percent decline from the first quarter. Revenues from laminate products totaled $44.3 million, while test and distribution services accounted for $10.9 million in revenues during Q2.
"The inventory positions at our customers have improved somewhat, but visibility remains low," said Dennis McKenna, chairman and CEO of ChipPAC.
McKenna added that the company anticipates a sequential decline in revenues of 10 to 15 percent in the third quarter. When competitors are suffering declines of sometimes twice that percentage, this type of bad news translates as good news for ChipPAC.
By the same token, Advanced Semiconductor Engineering Inc. (ASE) of Taipei, Taiwan, has reported a second quarter that is somewhat less dismal than its first. The company reported a 24.5-percent sequential decline in revenues to NT$8.5 billion ($244 million) for the second quarter, compared to NT$11.3 billion ($325 million) in Q1 of this year. ASE's sales were 32-percent lower than NT$12.4 billion ($356 million) in Q2 of last year.
"Both assembly and test volumes continued to decline, while overall visibility remains very poor," said Jason Chang, chairman of ASE. "However, we believe that the industry is gradually stabilizing based on our observation of customer forecasts, which are now less volatile compared with the previous quarter, and the actual ship-out rate is getting closer to the forecast."
The drop in IC assembly and testing services resulted in a net loss of NT$618 million in Q2, said ASE. In Q1, the contract assembly and testing house posted a net income of NT$352 million. ASE's net income in the first quarter of 2000 was NT$1.5 billion.
The company said that its assembly revenue fell 23 percent, and that test revenue dropped 28 percent compared to the previous quarter. Overall assembly and test unit volumes declined 20 percent, and average selling prices for services dropped five percent in Q2.
ASE president Leonard Liu said that the company made significant progress in advanced chip packaging segments by working on new microprocessor solutions for Via Technologies Inc. (Taipei) and Transmeta Corp. (Santa Clara, Calif.). "This is a major milestone for us as it demonstrates our capability at the top-end of semiconductor technology," said Liu. "We shall continue to focus more on offering the most advanced solutions to our partners."
The presence of words like "milestone" and "improvement" in company press releases that report staggering losses might appear to be unwarranted in the midst of this downturn, but the industry isn't likely to hit the ground running at this point, so we'll have to take what we can get.
Keithley establishes opto lab
CLEVELAND, OHIO - To quicken the pace of new product development and im prove product design concepts, Keithley Instruments has established an optoelectronics development lab in its Cleveland facility. The lab is outfitted with precision environmental control, specially constructed active vibration isolation surfaces and specialized laser test equipment. Engineers can use the facility for prototype testing and to calibrate optical power output measurements from compatible products, such as the Keithley integrating spheres (produced by Labsphere) that are sold in tandem with Keithley optical switching and measurement products.
"As Keithley has increased its focus on marketing products to the optoelectronics sector, this level of in-house measurement capability is a critical building block in our ability to move beyond general purpose instruments to those that are uniquely suited for testing active optical components," said Raj Nair, head of Keithley's optoelectronics business unit.
In related news, Keithley's new L-I-V Test system for optoelectronic component manufacturers received a Nortech Award, sponsored by the Ohio Dept. of Development, Key Bank, Enterprise Development Inc. and the Weatherhead School of Management at Case Western Reserve University.
Karl Suss and DELTA focus on MEMS testing
MUNICH - Karl Suss and Danish Electronics, Light and Acoustics (DELTA) have announced that they will work together to develop new methods and equipment for testing microelectromechanical systems (MEMS) at wafer level with non-electrical stimuli and detection. Wafer-level testing is a key element in the development and stabilization of new manufacturing processes, allowing manufacturers to sort out non-functioning die early in production.
The project, named MicroTest, will result in innovative prober equipment from Suss and specialized test services to be offered by DELTA. The main focus will be on physical sensors, such as pressure and gas sensors, accelerometers and microphones.
"Currently, electrical stimuli is typically used to test the MEMS, however using other stimuli, such as pressure or light, can tell the engineer much more about the functionality of the product," said Claus Dietrich, international product manager for probe systems at Suss. "Test equipment with this function is not yet commercially available. The collaboration with DELTA, along with the cooperation of leading MEMS producers, will enable us to develop optimized equipment."
Because the packaging, interconnect and interface circuitry is often a dominant part of the total production cost of a microsystem component, sorting out the bad die before further processing is critical to achieving cost-effective production. Adding calibration routines at wafer level for the individual die may further reduce the production cost. In the research and development phase, wafer-level testing is also of great value for device characterization as it eliminates the time-consuming dicing and mounting steps.
This collaboration is targeting European MEMS producers and is partly funded by the European EURIMUS project.
August broadens applications into opto arena
BLOOMINGTON, MINN. - August Technology Corp., a leading supplier of automated visual defect inspection equipment for the microelectronics industry, has recently announced the sale of NSX Series systems to manufacturers of vertical cavity surface-emitting lasers (VCSELs). In the midst of an industry-wide focus on the optoelectronics market, such versatility for August's inspection systems provides strong business opportunities.
"The flexibility of the NSX has allowed us to pursue applications in new and emerging market segments, such as VCSELs, and successfully implement the systems into non-silicon production environments," said Mayson Brooks, vice president of sales and marketing for August Technology.
According to market research firm ElectroniCast Corp., VCSELs are the fastest growing segment of the optoelectronics market.
AP
Correction
The Web site address to recieve information on TechSearch International's new study, "Flip Chip Market and Infrastructure Development," as reported in the August 2001 issue, is www.techsearchinc.com.