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Intel CEO to tool makers: 'Let's cooperate on 450mm'

Posted: 21 Nov 2007 ?? ?Print Version ?Bookmark and Share

Keywords:tool makers? equipment vendors? 450mm?

Despite some resistance for 450mm fabs in the market, Intel Corp. is moving ahead with 450mm technology and would like to cooperate with the IC-equipment industry in the arena, according to Paul Otellini, president and CEO of the chip giant.

Intel, for one, is attempting to push the industry towards 450mm fabs in the 2012 time frame or beyond. As reported, with backing from Intel, chipmaking consortium Sematech is devising a plan that will take a more direct path to 450mm fabs in the future.

But Sematech's recent unveiling of the controversial plan to hasten the industry's move to 450mm wafers has driven a wedge between the semiconductor equipment community and some chipmakers, rekindling the debate over who will fund the development of next-generation fab tools!or whether the shift should in fact proceed at all.

However, in an interview at the company's 45nm processor launch last week, Otellini said Intel is still "very interested" in moving towards 450mm fabs as a means to stay on the chip-production cost curve.

Intel, he said, has not set a timetable for the next-generation wafer size. But he said the company would like to work with!and not against!the IC-equipment industry in the 450mm arena. "We have to do it in concert with the equipment industry," he told EE Times.

Many of Intel's key fab-tool providers may end up developing 450mm gear!if the industry shifts to the next-generation wafer size, observers believe. Intel's equipment vendors include Applied, ASMI, Hitachi, KLA-Tencor, Nikon, Novellus, Varian, among others.

Who pays?
But it's unclear who will pay for 450mm tool development. Fab-tool makers are reluctant to pay for most of the 450mm development; most!if not all!vendors see little or no payback in the arena. Tool makers, however, would gladly develop 450mm technology!if the chipmakers themselves pay for the bulk of the research and development costs.

Over the years, Intel itself has been a big spender for equipment. For example, Intel "pays a lot for 300mm equipment," said William Holt, senior VP and general manager of the company's Technology and Manufacturing Group. But in an interview at the event, Holt also dropped hints that Intel would not foot the entire bill for 450mm tool development.

Holt did say 450mm would provide a cost benefit for the IC industry. "We need to go to 450mm," he said.

Meanwhile, at the event, Intel launched its recently-announced 45nm microprocessor lines. Setting the pace for the semiconductor industry, Intel rolled out the first members of its Penryn family, 16 45nm processors using new high-k dielectrics to control current leakage.

Other chip makers, including archrival Advanced Micro Devices Inc., are still months away from having a production-ready 45nm process, and most are not planning on initially using new insulating materials.

The 45nm chip launch puts Intel "far ahead" of the competition, according to Otellini. In fact, with its new fab and capital efficiency programs in place, Intel is readying a massive shift towards 45nm chip production.

Intel has no less than four 300mm fabs in the works, which are capable of 45nm production. As expected, Intel will initially move into 45nm production within its D1D fab in Hillsboro, Ore.

Also in the second half of 2007, Intel is expected to move into 45nm production within its Fab 32 plant in Chandler, Ariz. In the second half of 2008, Intel is projected to ramp up two more 45nm fabs, including Fab 28 in Israel and Fab 11x in New Mexico.

On the business front, the Intel executive remains upbeat despite some red flags in the market, namely the credit crunch and subprime mortgage fiasco in the United States.

Intel is seeing strong chip growth "in Europe and Asia-Pacific," he said. The company is "watching" the fallout of the subprime mess, he added.

Positive outlook
Despite the economic concerns, analysts are bullish on Intel. "We are raising our Q4 revenue and EPS estimates on Intel to reflect continued positive data points on PC unit growth and dominance of most segments of the market," said analyst Doug Freedman of American Technology Research, in a recent report.

"We believe Q4 is setting up for another solid period of PC unit growth, as evidenced by strong late Q3 chipset demand at Intel and data points out of companies including Asus, Acer, and Compal," he said, referring to the Taiwan ODM giants. "As a result, we believe the current quarter is likely tracking ahead of plan for PC component companies with Intel's fabs full and demand outstripping supply."

There's bad news for Intel's rivals. "We believe the company's server and notebook parts continue to dominate the OEM space as Barcelona is late to ramp and Santa Rosa continues to benefit from record notebook shipments," he said, referring to Advanced Micro Devices Inc.'s latest processor, dubbed Barcelona.

"We believe [Intel] will continue to dominate the high-end market as AMD has been late to deliver Barcelona/Phenom, both of which are struggling to deliver performance boosts due to a bad marriage of process technology and design," he added.

- Mark LaPedus
EE Times




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