SOURCE: International SEMATECH Manufacturing Initiative

November 01, 2005 11:16 ET

Consumer Electronics May Spawn Gigafabs and 2X Tool Productivity Increase, TSMC Executive Tells ISMI Symposium

AUSTIN, TX -- (MARKET WIRE) -- November 1, 2005 -- The emergence of the consumer electronics era may drive IC manufacturers to build more flexible "gigafabs" and encourage equipment makers to double their tools' productivity, a TSMC senior executive told technologists at the ISMI Symposium here.

Mark Liu, vice president of operations for TSMC (an ISMI member) and responsible for his company's 300 mm production fabs, said the growing consumer IC market is changing the semiconductor industry by shortening product cycles and accelerating production times.

"The economics of the consumer market will drive the semiconductor industry to be more volatile, more diverse, and even more cost-sensitive," Liu declared. "There is [opportunity] here, but we have to recognize the difficult set of demands."

Liu spoke to about 300 participants at the opening session of the second annual ISMI Symposium, sponsored recently by the International SEMATECH Manufacturing Initiative (ISMI) to bring together technologists to work on solutions to the industry's most pressing manufacturing issues. ISMI was formed in 2004 with a mission to provide solutions to current and future fab challenges for manufacturing-oriented chip-makers. ISMI's members are AMD, Freescale, Hewlett-Packard, IBM, Infineon, Intel, Panasonic, Philips, Samsung, Spansion, TSMC, and Texas Instruments.

In his keynote address, Liu pointed out that consumer electronics -- which include wireless communications, videocams, home appliances and entertainment devices -- is known for fast ramp-ups of multiple products and continuous price reductions for consumers. To be successful in this arena, chip-makers and tool suppliers must change the way they do business, he said.

"This [market] requires a different set of mind" for semiconductor producers, Liu said. "We find that there really is no room for overspecification of semiconductor design, and no room for over-design."

Liu also urged suppliers to match the economics of the consumer electronics industry, aiming for 2X improvement in productivity before the next transition in wafer size (generally expected to be 450 mm). Even market followers will have to customize their equipment for high-mix, low volume production, allowing for smaller lot sizes and frequent recipe changes. "A new equipment concept will have to be applied to trailing-edge technology," Liu advised.

According to industry analysts, consumer electronics accounts for about 16 percent of the total world market for semiconductors, but is projected to increase to 22 percent ($81 billion) by 2010. This market requires agility to pursue: Liu said that while desktop PCs, monitors and notebooks have life cycles of two to four years, the cycles for cell phones, DVD players and digicams can be measured in months. At the same time, prices of these products have been falling by 25 percent a year since 1998.

Liu cited TSMC's Fab 12 in Hsinchu, Taiwan and Fab 14 in Tainan, Taiwan, as examples of the gigafab model that his company has adopted to address the consumer market. A gigafab's characteristics, he said, include a $6 billion to $10 billion investment; capacity for 80,000 to 100,000 wafer starts per month (wsm); low operating costs; high flexibility, agility and precision; and short cycle times.

"We find that a gigafab provides benefits in both production costs and agility," Liu noted. Such a fab also requires a strong computer-integrated manufacturing (CIM) infrastructure, he said.

Liu also listed several challenges facing chip-makers who are willing to weather tough economic demands for a chance at prospering in consumer electronics:

--  Keep equipment affordable by working with design engineers. Liu noted
    that tool costs are accelerating at 20 percent a year, which means an EUV
    stepper could cost $40 million in 2008. "We have to reduce the costs along
    the supply chain," he said. "We need to work with the engineers designing
    the equipment early in the game."
--  Recognize that equipment operating efficiency declines with high-mix
    manufacturing. For example, more frequent recipe changes reduce the
    efficiency of an ion implanter by 25 percent for a foundry.
--  Seek productivity improvement in 300 mm tools. For example, idle times
    for a continuously running CVD tool are 30 percent for the main chamber,
    and 66 percent for other components.
--  Align automated material handling systems with tool roadmaps to
    produce overall productivity improvement.
--  Aggressively seek improvements in cycle times. For example, with mask
    layers having doubled between the 0.3 um and 90 nm generations, lithography
    cycle times have had to decrease by half to maintain the same level of

ISMI is a global alliance of the world's major semiconductor manufacturers, dedicated to reducing cost per wafer, and ultimately cost per die, through cooperative programs focused on manufacturing effectiveness. The consortium conducts programs in manufacturing infrastructure, methods, standards, and productivity, with the aim of reducing the costs of producing finished wafers and chips and driving solutions to major productivity challenges. ISMI is a wholly owned subsidiary of SEMATECH of Austin, TX.

NOTE TO EDITORS: Photo available.

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