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June 2009

Netbook PCs: A Platform Battleground

Phoenix, Arizona June 25, 2009 - Netbooks are a new emerging category of Personal Computers. It has also become a new emerging battleground. There are two battles shaping up. The first is among the chip vendors – x86 vs. ARM. The second battle is the operating system – Microsoft vs. Linux.

Driving a Slow Sebring in the Bay Area

Whoever is making product decisions about Chrysler models in the new Fiat/Chrysler company has a problem they need to fix.

On a recent trip to the Bay Area I drove a rental car, a Chrysler Sebring LX Convertible with a 2.4 liter DOHC four-cylinder engine and a four-speed automatic transmission.  It was underpowered.  It understeered badly on freeway ramps.  The engine and transmission were extremely rough and noisy above 3,000 rpm, which was especially noticeable when accelerating from 40mph to 65mph on the freeway to merge with traffic. 

As I drove around, pondering this, a thought struck me, “Maybe I’m not the driver this car was made for.  Maybe it was made for a driver who doesn’t want acceleration or handling.”   I decided to see what would happen if I drove the car is if I were that kind of driver. 

At the next stop light, I feathered the accelerator pedal, pushing down only about a quarter of an inch.  The car accelerated slowly to 2,500 rpm and then upshifted.  Voila! No noise!  A Mercedes behind me was trying desperately to get past me.   Drivers in the lanes on either side of me passed me, but at least I wasn’t in their way. 

At the second stop light, I accelerated a little harder.  At 3,000 rpm, the noise and roughness began.  3,000 rpm seemed to be a virtual red line.  I held up someone in an American sedan, but the driver considerately waited half a block to go around me. 

Netbook PCs: A New Platform Battleground

Netbooks are a new emerging category of Personal Computers. There have been several efforts over the years for a low-cost and compact mobile PC. The introduction of the Intel Atom microprocessor in 2008 spurred the growth of netbooks, reaching 12.5 million units in 2008.
The key feature for a netbook is that it is designed primarily for web browsing and emailing. Thus, wireless connectivity to the Internet is necessary. Low-power consumption, compact design and light weight are essential.

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Foundry Wafer Pricing 2Q09

The Semico Foundry Wafer Pricing report is published twice a year. It includes quarterly prices for wafers manufactured at foundries utilizing a logic process at 0.35µm, 0.25µm, 0.18µm, and 0.13µm on 200mm wafers. It also includes pricing for 90nm and 65nm on 300mm wafers. Actual prices are presented for six quarters, including the present quarter, and a forecast for the next two quarters are provided. Prices are differentiated by low and high volume runs. There is additional segmentation for metal layers by technology, with a total of seven different metal layers represented.

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The Captain Buys a Car Company

Is this the future of the automobile industry?  The Captain, Roger Penske, CEO of PAG (Penske Automotive Group), is buying a car company; but he is not buying the whole company.  Instead, he is buying only the Saturn distribution network and the rights to the Saturn brand.  Under the terms of the agreement GM would continue production, under contract, of the Saturn Aura, Vue and Outlook models until the middle of 2011.  In the meantime, PAG will be looking for cars from other manufacturing sources. 

This turns the automotive industry on its head.  Instead of an automotive manufacturer controlling the dealerships, the dealerships will outsource production.  Is this an unfair advantage? 

Roger Penske is probably the most successful racing team owner in the history of motor racing.  Others, Enzio Ferrari for example, may have won more races; but only Penske parlayed his racing team ownership into a business empire. 

Market Update: April Sales the Best in 15 Years

Phoenix, Arizona June 2, 2009 - At the Semico Summit in March, Jim Feldhan's opening remarks covered the State-of-the-Industry and the unprecedented decline in the fourth quarter 2008. While many other market observers fell into the doom and gloom scenario predicting a 20%-30% decline for 2009, Semico utilized its IPI (Inflection Point Indicator), MAP Model and extensive industry experience to refute this conclusion. Semico’s assertion was that inventories were not grossly out of balance in Q3 2008.

April sales the best in 15 years

At the Semico Summit in March my opening remarks covered the State-of-the-Industry and the unprecedented decline in the fourth quarter 2008. While many other market observers fell into the doom and gloom scenario predicting a 20-30% decline for 2009, Semico utilized it’s IPI, MAP Model and extensive industry experience to refute this conclusion.  Semico’s assertion  was that inventories were not grossly out of balance in Q3 2008 and the subsequent drop in sales was an over reaction resulting in below healthy inventory levels.

Some proclaimed that cell phones were going to experience dramatic drops due to the recession.  Our research and interviews showed just the opposite.  Cell phones are now considered a necessity.  It is the “land line” that is now viewed as an unnecessary extra! As far as the recession goes, consumers that we have interviewed who are looking to reduce their monthly expenditures are researching cell phone providers to pick a plan that reduces their monthly bill. In many cases this results in a change in carriers which requires a new phone! Any reduction in cell phone sales due to the rise in unemployment is overshadowed by consumers changing providers to save on monthly bills.  In December 2008, Semico forecasted cell phones to be down 10% in 2009 and we reaffirm this forecast.

The memory market continues to be plagued by excess capacity, however recently we began seeing improvements and stability even in this market segment.  

Netbooks: Harder, Better, Faster, Smaller

Netbooks, the newest trend to hit the computer scene, has seen amazing growth over the past year and is poised to see even more growth over the next five years. Semico expects a 31% CAGR between 2009 and 2013 as netbooks grow from 20 million units to 60 million units.

It is rare to see a product with such a niche target market grow so large so quickly, and in this report Semico explains what trends drive this market, who exactly is the target market, and what this all means for the semiconductor industry in the future.

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