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Executive panel yields divergent predictions about next killer app

Posted: 04 Aug 2005 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor? sensory? rbc capital markets? esilicon?

Predictions about what will be the next major driver for the semiconductor industry diverged widely at an executive panel at the RBC Capital Markets' North American Technology Conference here.

Jack Harding, president and CEO of eSilicon said that the sensory industry was his favorite among two or three areas with the potential to be a large-scale driver for the semiconductor industry.

Harding said sensor technology could potentially be incorporated into every consumer product, closing the gap between humans and technology and creating a "Jetson society" whereby all electronics have the means to process, communicate and display enormous amounts of information.

George Barber, president and CEO of SyChip Inc. said that consumer products are the current driver of the semiconductor industry and would remain so. He noted that a number of consumer products with high semiconductor content currently sell 50-100 million units per year, which he believes will be sufficient to continue driving the industry. PCs, he said, were the industry driver for a long time, despite the fact that it took many years to reach the 50-100 million unit level.

Paul Russo, president, chairman and CEO of Silicon Optix Inc. (Dallas) said free, unlimited bandwidth and "video everywhere" would be the industry's next major driver.

Geoff Ribar, chief financial officer at Matrix Semiconductor Inc. didn't hazard a prediction about the next major industry driver, but said that as long as Moore's Law remains in effect, the industry would remain on track. He noted that two years ago there were questions about the need for increased device speed, but that the industry's new state-of-the-art dual-core processors have changed that.

Harding, former CEO of Cadence Designs Systems Inc. expressed confidence that the industry would continue to innovate, regardless of the form. "I don't think [innovation] is going to stop," Harding said.

Russo cautioned North American and European companies against trying to compete with the lower manufacturing costs offered by Asian economies. Russo said Jack Welch, former chairman and CEO of General Electric Co. wisely decided several years ago to remove GE from businesses, such as semiconductors, in which it would face direct competition from Asia.

"Equipment companies and companies that have unique, defensible technology will continue to grow," Russo said. "But companies that are trying to compete at the low end with China or Taiwan, good luck."

Russo said that the heyday of North American fabless semiconductor companies is over. "Those startups will be done in the Far East," he said.

Ribar said the semiconductor industry's heightened focus on consumerism would create a new type of electronics cyclicality, which has not really been fully understood. "Cycles have changed," Ribar added. "Business has changed."

- Dylan McGrath

EE Times

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