In the News
06/01/2004
U.S. Electronic Polymer Market to Reach $4.5 Billion in 2008
CLEVELAND, OHIO — Demand for electronic polymer products is on target to expand 13.3 percent per year to $4.5 billion by 2008, according to Electronic Polymers, a recent study from The Freedonia Group Inc., an industrial research firm. Production of these products will require 510 million lbs. of resin valued at $2.2 billion, and growth is expected to be driven by a strong recovery in the semiconductor industry and a shift to new technologies that include more intensive use of polymers.
The primary competitive focus for electronic polymers used in PCB laminates and packaging will be the continuing replacement of wire-bonded packages by flip chip and other types of area array and chip scale packaging (CSP) in many applications, according to the study. Standard wire bonded packages are expected to continue to predominate, but the move to area array packaging will cause significant shifts in material requirements as formerly niche materials become major segments of the industry. Chip underfills used in flip chip assemblies, for example, are expected to see annual growth of nearly 30 percent per year through 2008.
Conductive adhesives will also see strong gains, according to the study's findings, as these materials replace lead solders and facilitate the use of less expensive compounds in molded interconnect devices. Conversely, demand for epoxy molding compounds and die attach adhesives (both used in traditional wire-bonded packaging) will post below average gains.
A few segments of the electronic polymer products market are expected to experience particularly strong growth. Annual gains for low-k dielectric polymers are forecast to reach $285 million in 2008, up from less than $10 million in 2003. Polymers with low dielectric constants are challenging traditional silicon dioxide in crucial interlayer dielectric applications in semiconductor fabrication. The primary competition for low-k polymers, which are applied via a spin-on process, is from chemical vapor deposition (CVD) processes using carbon-doped silicon dioxide. The outcome of this competition, the study predicts, is likely to be a combination of spin-on polymers and CVD-applied materials. Compounds made of high-temperature thermoplastics such as liquid crystal polymer and polyethersulfone used in molded interconnect devices are another area of strong growth. Demand for such compounds has been growing on average 80 percent annually since 1998, and is forecast to grow nearly 50 percent per year through 2008.
Corporate Spending on IT Reportedly Driving Semiconductor Sales
SAN JOSE, CALIF. — Thanks in large part to corporate spending on IT hardware and software, worldwide sales of semiconductors rose to $16.28 billion in March. This is an increase of 4.4 percent from the $15.58 billion reported in February, according to the Semiconductor Industry Association (SIA), and a 32.3 percent jump from March 2003.
Global sales grew to $48.8 billion in the first quarter of 2004, compared to $36.4 billion in the first quarter of 2003 and $48.1 billion in the fourth quarter of 2003. The first quarter is normally a seasonally weak one, SIA says, while the fourth quarter is usually the strong one. Combined with the 4.2 percent first quarter growth in the U.S. GDP, the sequential sales growth in the first quarter is viewed by many as a further indication of the strength of the economic recovery that is driving demand for a broad range of semiconductor products.
Strong sales in the first quarter are very encouraging, says George Scalise, SIA president. "Based on the strong first quarter results, it now appears likely that growth for 2004 will exceed 20 percent. One of the leading drivers of sales growth was continued growth in corporate spending on IT products, which increased by 11.5 percent in the first quarter — the fourth successive quarter of strong growth, and the third straight quarter of double-digit growth. The fundamentals are in place for continued growth in chip sales through the end of the year."
Sales were up sequentially for all geographic regions in March.
Hestia Receives Patent for Fingerprint Sensor Package
SANTA CLARA, CALIF. — Hestia Technologies Inc. has received U.S. Patent No. 6,667,439, titled 'Integrated Circuit Package Including Opening Exposing Portion of an IC,' for its technology presently used in volume manufacturing of fingerprint touch sensor packages with an exposed portion of die.
This advanced technology provides a packaging solution that makes it possible to produce a low-cost plastic molded package with an opening exposing a selected portion of the die. Although the initial application of the technology was for touch sensors, the company expects that the technology will soon find use in other applications in which a portion of the die needs to be exposed.
Intel Launches $2 Billion Fab Conversion Project
CHANDLER, ARIZ. — Intel Corp. is busy converting one of its 200-mm wafer fabs, known as Fab 12, into a state-of-the-art 300-mm one in Chandler, Ariz. This conversion project represents a first for Intel. The company cites the flexibility of its factory design as the reason it's able to completely modify the interior of its cleanroom to accommodate the much larger 300-mm production equipment. The conversion is projected to yield more than twice the capacity at significantly lower costs.
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When the project is completed, the converted fab will become Intel's fifth 300-mm wafer facility. Five 300-mm fabs provide the equivalent manufacturing capacity of about 10 200-mm factories, according to the company. Intel's other 300-mm fabs are located in Hillsboro, Ore. (two facilities), Rio Rancho, NM and Leixlip, Ireland.
The fab is expected to begin initial production on 65-nm process technology in late 2005.
Wafer Shipments Reach All-time High
SAN JOSE, CALIF. — Worldwide shipments of silicon wafers have surpassed the record levels set in 2000, while at the same time factory utilization is tightening. Revenue growth still lags behind area growth as 300-mm wafer sales become a more important part of the mix, reports SEMI in its quarterly analysis of the silicon wafer industry, although prices are starting to firm up for smaller diameter wafers.
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In the first quarter of 2004, worldwide silicon wafer shipments increased 9 percent sequentially, and 29 percent from the first quarter of 2003. Total silicon wafer area shipments reached 1,514 million square inches during the most recent quarter, up from the 1,392 million square inches shipped the previous quarter.
World Semiconductor Council.Meets, Recommends Actions to Promote Growth
BUSAN, KOREA — The World Semiconductor Council (WSC), representing the European, Japanese, Korean, Taiwanese and U.S. semiconductor industries, recently met in Busan, Korea for its 8th annual meeting to address a number of public policy issues, including intellectual property, environment and trade.
"The WSC provides a valuable forum for the world's major semiconductor-producing regions to discuss policies and issues affecting the future of the industry,"says George Scalise, president of the Semiconductor Industry Association (SIA). "This forum also enables chipmakers from around the world to share information on environmental protection, worker safety and health, and public policies that allow consumers everywhere to benefit from semiconductor technology advances."
The WSC created an Intellectual Property Task Force and adopted a policy paper that sets out an approach to provide IP protection for layout designs of ICs. This form of IP protects the layout of ICs, and is included in the World Trade Organization's IP agreement. The WSC also called on all governments and authorities to implement effective IP enforcement measures.
"The new WSC policy on layout design IP, coupled with the WSC's call for enforcement actions that provide an effective deterrent against IP violations, can make a real dent in illegal copying of semiconductor designs," says Scalise. "Without adequate IP laws and enforcement, companies will not invest in the R&D needed to create the new electronics products we all enjoy."
The WSC received reports on industry efforts to reduce emissions from PFCs, reduce energy consumption and share best practices on chemical management. Work will continue on plans to develop a data collection program on energy usage, communicate with equipment and materials suppliers on environmental and safety/health issues, and determine the feasibility of quantitative common targets on environmental metrics. WCS plans to review regulatory and legislative issues, such as the EU's RoHS directive, that will have a global impact on the industry.
The WSC also voiced support for other actions that will facilitate consumer access to the latest semiconductor technologies at the lowest costs. Their recommendations included urging governments and authorities to avoid mandatory technical standards, and to follow WSC-specified principles when standards are mandatory; prohibit the imposition of levies on digital equipment and bland digital recording media; and treat multichip ICs the same as general ICs in terms of customs classification codes, thereby allowing them to remain tariff free.
Best Establishes High-volume CSP Production Line
SANTA CLARA, CALIF. — Best Electronics and Components Co. Inc., a contract test facility for analog and mixed-signal semiconductors, has established a high-volume chip scale package (CSP) production line. The company reports that the new line can electrically sort, laser mark, visually inspect, tape-and-reel multiple wafer-scale devices such as standard or bumped die as small as 0.5-mm square, and QFN packages at production volumes of 2 million devices per week.
The company's new line uses its totally inkless process based on an advanced wafer mapping program that electronically merges bump maps, electrical sort maps and vision inspection maps for all formats into one composite map that controls the selection and taping of all devices. This inkless electronic mapping process, according to the company, eliminates unnecessary manufacturing operations, increases the quality level and throughput by 400 percent. The line also features a 'punch-through' tape that allows customers to remove die from either side of the finished tape.
AMD Plans Test/Mark/Packaging Facility in China
HONG KONG, CHINA — AMD has plans to open a new test, mark and package facility in China's Suzhou Industrial Park for seventh- and eighth-generation microprocessor products. The facility will occupy approximately 11,000 sq. meters, and is expected to reach volume production during the fourth quarter of this year.
"The second, state-of-the-art TMP facility in Suzhou is another key milestone for AMD's expansion in China," says Karen Guo, corporate vice president and general manager of AMD China. "With one of the world's hottest chip markets, an abundant labor force for skilled manufacturing, an abundant labor force for skilled manufacturing and world-class engineering talent, China is a natural choice for AMD's microprocessor manufacturing. We are committed to strengthening our position in this vitally important region, and long-term investments in production capabilities like this demonstrate this commitment.
AMD's existing flash memory test/mark/packaging facility, FASL Suzhou, was established in August 1995.
Honeywell Acquires Intri-Plex Technologies' Thermal Solutions Product Line
SUNNYVALE, CALIF. — Honeywell has acquired the Thermal Solutions product line of Intri-Plex Technologies, Inc. (IPT). The acquisition adds leading-edge metal forming technology for advanced heat spreaders to the packaging materials portfolio of Honeywell Electronic Materials.
As part of the deal, Honeywell will acquire manufacturing operations in Thailand, which Honeywell Electronic Materials and IPT established in 2003 exclusively for the manufacture of heat spreaders. Financial terms of the deal were not disclosed.
IPT, a partner of Honeywell Electronic Materials since 2001, is a premier supplier of heat spreaders for advanced semiconductor packaging. Thermal dissipation is one of the industry's largest technology challenges and the acquisition further expands Honeywell's portfolio of thermal management solutions. The acquisition will support both product development and volume growth, and should reinforce Honeywell's ability to supply the highest quality products available.
Dow Corning Offers Specialty Organics
MIDLAND, MICH. — Dow Corning Corp. is entering the $1 billion specialty organic materials market, as part of an overall company strategy to offer a complete range of materials for the increasingly diverse and demanding electronics manufacturing applications. Products in Dow Corning's organic materials offering support a broad range of applications, according to the company, from semiconductor packaging and board-level assembly to automotive and consumer electronics assembly.
The company's decision to develop and offer specialty organic materials marks an important milestone in the company's 60 years as a provider of silicone materials development, says Tom Cook, Dow Corning's global industry executive director. The need for both organics and silicones, to meet manufacturing goals, becomes apparent as devices become thinner, smaller and faster.
As with all of Dow Corning's materials, the company says its new specialty organics are backed by their electronics business solutions program, which supports the full range of customer needs from qualification and equipment selection to the tailoring of materials for specific process requirements.
Universal Strengthens European Infrastructure
BUDAPEST, HUNGARY — Universal Instruments recently turned its Budapest, Hungary facility into its European headquarters, reflecting the changing geographic spread of the company's customer base with Europe. Other Universal offices are also being relocated in the south of England and in Brittany, France, to be closer to customers and fast transportation links.
Universal's Budapest operation includes full sales demonstration, training and technical support facilities, in addition to finance functions and the order center for European spare parts.
The company's offices in Spain, Italy and Germany all remain, with the latter also acting as a global holding hub for equipment spares and consumables inventory.
Price Hike for 0.13-Micron Process Geometry
SAN.JOSE, CALIF. — The average prices for wafers using 0.13-µm process geometry jumped six percent from Q3 2003 to Q1 of 2004, according to the Fabless Semiconductor Association's (FSA) quarterly Wafer Fabrication and Assembly/Test Pricing Survey.
The survey analyzed the average price paid per wafer by 129 fabless companies and integrated device manufacturers (IDMs). The majority of the participants ordered 0.18-µm process geometry, compared to 10 percent of all IDM orders placed for the same process.
Positive Picture of SATS Market Presented at MEPTEC Conference
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BY JULIA GOLDSTEIN
SANTA CLARA, CALIF. — MEPTEC is expanding beyond its traditional audience of SATS (Semiconductor Assembly and Test) engineers. Last year it introduced Executive Level Membership (ELM) to reach out to top decision-makers in the SATS community. On May 12, MEPTEC held its first Interconnect Investors Conference. MEPTEC Executive Director Phil Marcoux was delighted to present "the world's most knowledgeable collection of analysts" at the conference, as well as short presentations from large and small SATS companies.
There was some debate over how to view the forecast increases in capital expenditures (capex). Jim Walker (Gartner Dataquest) expressed concern about capex going too high in 2004 and then crashing in 2005 or 2006, similar to what happened in 2001 after an 84 percent growth in capex during 2000. Lucas Ward (WR Hambrecht) was not worried about oversupply, stating that the increase in capex comes from a low base because of decreased spending in recent years. Both Satya Chillara (RBC Capital) and Ward noted that the expected ratio of capex to revenue was in a healthy 18 to 23 percent range, suggesting that overcapacity would not be a problem.
The increased trend in outsourcing is a significant driver in the growth of the SATS market. Eric Gomberg (Thomas Weisel Partners), who coined the acronym SATS for this market, noted that this outsourcing trend needs to be demonstrated to analysts in order for Wall Street to look kindly on SATS companies. Investors will also react positively to increases in R&D spending, such as Amkor's recent announcement.
Robert Krakauer from ChipPAC and Drew Davies and George Brathwaite of STATS discussed the upcoming ChipPAC/STATS merger, due to be completed in June. Krakauer described it as a "most perfect" fit because of the minimal overlap in customer base and geographical footprint between the two companies. Once the merger is complete, one goal of the combined company is to identify cross-revenue synergies, with the goal of increasing the percentage of ChipPAC's assembly customers who also use the company for test services from 45 to 75 or 80 percent. Similarly, ChipPAC/STATS will work on selling assembly services to STATS's test customers.
Analyst presentations tend to focus on the top tier SATS companies, but many smaller companies are doing well in their niches. Another upcoming merger is that of UltraTera and UTAC in the area of memory test services. Jack Snyder described UTAC as "test-centric and proud of it," and expects that the merger will enable them to expand their product offerings. PSi Technologies, focused exclusively on the power semiconductor market, stands to benefit from growing demand for power devices. Jim Knapp discussed transfer of ON Semiconductor's technology into PSi and expanding PSi's line of QFN packages.
While the analysts presented overall positive pictures of the SATS market over the next one to two years and many SATS companies are thriving, wafer level packaging (WLP) was mentioned as a threat to the survival of SATS companies. It is possible to envision a future in which manufacturing goes from wafer fabrication, including WLP processes, directly to board assembly, squeezing out the packaging houses. It will be interesting to see what a SATS investor conference looks like a few years from now.
SEMI Book-to-bill Rose to 1.14 in April
SAN JOSE, CALIF. — North American-based manufacturers of semiconductor equipment posted $1.59 billion in orders in April 2004 and a book-to-bill ratio of 1.14, according to the April 2004 Express Report published by SEMI.
"The strength in bookings for new semiconductor manufacturing equipment in early 2004 is consistent with both announced capital spending plans and high capacity utilization levels reported by semiconductor manufacturers," says Stanley T. Myers, president and CEO of SEMI. "The capacity utilization trends are supported both by strong semiconductor unit growth and silicon wafer shipments in the first quarter."
The three-month average of worldwide bookings in April 2004 was $1.59 billion. The bookings figure is 16 percent above the revised March 2004 level of $1.38 billion, and 111 percent above the $757 million in orders posted in April 2003.
The three-month average of worldwide billings in April 2004 was $1.40 billion. The billings figure is 10 percent above the revised March 2004 level of $1.27 billion, and 67 percent above the April 2003 billings level of $840 million.
Amkor Scores IBM Supply Agreement
CHANDLER, ARIZ. — Amkor Technology Inc. has entered into a long-term agreement with IBM for semiconductor assembly and test services. Under the terms of the supply agreement, Amkor will receive a substantial majority of IBM's subcontract wirebond and flip chip assembly and final test.
"We expect the incremental revenue associated with this supply agreement will be modest in 2004, with most of the effort this year focused on qualifying a number of products," says Oleg Khaykin, Amkor's executive president for corporate development. "However, based on preliminary volume estimates, we anticipate the revenue associated with this supply agreement may exceed $150 million in 2005."
The transaction is valued at approximately $145 million, consisting of $114 for land, buildings and fixtures, equipment, intangibles and IP, with payments of $20 million at closing expected on May 31, 2004. A payment of $43 million will follow in the fourth quarter. Amkor will pay $82 million to the building developer in China in the fourth quarter.
APiA, DPC Offer Wafer-level Packaging Technology Session at 11th Annual KGD Packaging and Test Works
AUSTIN, TEXAS — The Advanced Packaginging and Interconnect Alliance (APiA) will present an educational one-day seminar on advanced packaging manufacturing during the final day of the 11th Annual KGD.Packaging and Test Workshop, September 15-18, hosted by Die Products Consortium (DPC) in Napa, Calif.
APiA's seminar will cover bump, wafer-level chip scale packaging and post-passivation processes for wafer-level packaging of rapidly evolving microelectronic devices.
Participant of the KGD workshop will gain insight into established and emerging technologies that will support growing market demands, according to the DPC, for stacked packages, wafer-level packages, module test and bumped or bare die. An international line-up of presenters will focus on issues such as insertion of die products (bare die, flip chip and wafer-level chip scale packaging), test and development of advanced substrates and assembly of completed modules.
In addition to the technical program, the DCP is offering free, pre-workshop tutorials on topics such as wafer thinning and wafer-level packaging.
For more information about the workshop, visit www.napakgd.com.
SMTA Expands Online Knowledge Base
MINNEAPOLIS, MINN. — The SMTA Knowledge Base (www.smta.org), a searchable archive of all technical papers presented at Surface Mount Technology Association (SMTA) conferences, has expanded to include more than 1,400 full-length technical articles from many globally recognized conferences, including SMTA International and the Pan Pacific Microelectronics Symposium.
Papers in the Knowledge Base date as far backas 1996 and cover a range of issues in electronics manufacturing, including assembly, design, packaging, soldering, quality, test and reliability. Most recently, 115 papers from SMTA International 2003 were added to the online resource, with new papers on MSD, connector issues, black pad, 3-D/system-in-package/WLD, leadless packaging, HDI, 0201, DFM, lean manufacturing, process control, AOI, lead-free, global business issues, emerging technologies, MEMS, MOEMS and microsystems.
While all visitors are welcome to search for authors and abstracts, only SMTA members have free access to file downloads.
Visit SMTA's website at www.smta.org.
Cookson's Ray Sharpe Resigns
PROVIDENCE, R.I. — Raymond P. Sharpe recently resigned as chief executive of the Electronics Group at Cookson to pursue a career in the private equity sector. Cookson's chief executive Stephen Howard is now responsible for the division.
"Ray Sharpe has been a valued member of Cookson's executive team for many years, and we are sorry to see him go," says Howard. "However, Cookson Electronics maintains a vastly experienced and highly motivated management team."
"I'm leaving Cookson in good hands and in a great position to move forward for years to come," says Sharpe. "The company is poised to capitalize on the continued market recovery. Cookson Electronics has thousands of valued and talented employees, with a strong leadership team. These strengths will continue to keep the company in the forefront of the industry."
Tessera Technology Licensed for Military/Aerospace Applications
SAN JOSE, CALIF. — Tessera Technologies Inc. and San Diego, Calif.-based NxGen Electronics have signed a licensing agreement that allows NxGen to manufacture Tessera's microZ ball stack package, a small form factor multichip packge optimized for high-performance computing applications.
"This agreement reflects our commitment to the ongoing development, broad adoption and commercialization of our next-generation packaging technologies," says Craig Mitchell, Tessera's vice president of marketing.
Availability of the packages from NxGen is planned for Q3 this year.
ASAT's Revenue is Up
PLEASANTON, CALIF. — ASAT.Holdings Ltd.'s financials for the fourth quarter and fiscal year 2004, ended April 20, 2004, show significant improvement.
Net revenue for fiscal 2004 was $214.7 million, a 43 percent jump from $150.1 million in fiscal 2003.
For assembly, the net revenue reached $56.7 million — an increase of 6 percent, compared with $53.5 million in the third quarter and an increase of 85 percent compared with $30.7 million in the same period last year.
For test, the net was $6.3 million — an increase of 2 percent, compared with $6.1 million in the previous quarter and an increase of 65 percent compared with $3.8 million in the fourth quarter of 2003.