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October 2010

SIP Market Consolidating, Not Weakening

Phoenix, Arizona October 5, 2010 - 2008 was forecast to be a good growth year, until external events in worldwide financial markets overtook the SIP market. The SIP industry was not immune to the market forces unleashed in 2008, declining 21.9% in 2009. However, the recovery which arrived in the second half of 2009 prevented the 3rd Party SIP from declining at an even steeper rate. It is Semico's view that the SIP market will continue to perform at rates comparable to other semiconductor markets, with 17.1% growth in 2010.

Another Vote for Gate-First HKMG

On September 15th, 2010 Panasonic Corp. quietly announced they would begin shipping 32nm gate-first HKMG LSI parts for use in their consumer line of Blu-ray DiscTM players.  This announcement is notable for several reasons.  First, this is another endorsement for the gate-first HKMG team.  IBM and the Common Platform foundries are going with gate-first.  Intel and TSMC are the other big players going with the gate-last HKMG technology. 

 Panasonic developed their process with Renesas Electronics Corp. based on a research program with IMEC.  Panasonic uses a hafnium based high-k dielectric with their metal gate electrodes.  Assuming this chip is being manufactured in Panasonic’s Uozu fab in Japan, that means Panasonic is the second company to mass produce and ship a 32nm HKMG product. Of course, Intel was the first.  AMD has manufactured chips at GLOBALFOUNDRIES using their 32nm gate-first HKMG technology but is not expected to begin shipping product until 1H 2011. 

August Semiconductor Sales Right on Target

The WSTS/SIA released the August monthly semiconductor sales statistics Friday. Worldwide revenue was right in line with Semico's forecast for the month of August. Worldwide sales were 0.4% higher than our forecast adding to our confidence that the market will top $298 billion or 31.8% growth for the year.

This is the same forecast number that we've had for several months. The real question that everybody is asking now is, how does 2011 look? Our monthly inflection point indicator still points to a healthy first half. Check out our IPI report (sent to subscribers on Friday, Oct. 1) for more information on the third and fourth quarter. We believe 2011 will produce a 9.5% growth for industry revenues. The semiconductor industry will exceed the $300 billion mark for the first time in history!

While the US economy may still appear to be on shaky ground, the recession has ended and economic strength is slowly improving. However, it will continue to take some time for the macro-economy, including employment, to log significant gains. But don't let the employment numbers fool you. The new consumer buying patterns have changed with electronics on the top of everyone’s wish list while cars and houses have dropped significantly. Furthermore many of the other economies around the world in countries such as China, India, Brazil, Taiwan and Korea are showing sustained strength and growth.

Jim Feldhan

The Blu-ray Argument: Players & Recorders

The recession of 2008 and 2009 impacted the entire semiconductor industry, including a relatively new market for chips: Blu-ray Players. A fledgling technology that had just defeated the HD-DVD format in 2008, Blu-ray had a difficult time gaining traction in its early years due to limited Blu-ray disc content and a high ASP compared to DVD Players.

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