Taking Sides in Chip Wafer Debate - TheStreet

Taking Sides in Chip Wafer Debate

There are four camps involved in the debate for the semiconductor industry to move to 450mm wafers from 300mm.
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NEW YORK (

TheStreet

) -- There are four camps strategically focused in the debate for the semiconductor industry to move to 450mm wafers from 300mm.

Camp No. 1 is Sematech, which is spearheading the charge for 450mm. Sematech, or Semiconductor Manufacturing Technology, is an association of semiconductor companies who make up 50% of the worldwide chip market. Members are

Intel

(INTC) - Get Report

,

IBM

(IBM) - Get Report

,

Micron

(MU) - Get Report

,

Hewlett-Packard

(HPQ) - Get Report

,

National Semiconductor

(NSM)

,

Globalfoundries

,

NEC

,

Samsung

,

Renesas

,

Toshiba

,

Infineon

,

UMC

, and

Taiwan Semiconductor

(TSM) - Get Report

.

Sematech is targeting 450mm ''demonstration'' tools for the 32nm (nanometers) node and ''pilot tools'' at 22nm.

Camp No. 2 is EEMI-450, which is pushing for 450mm development in Europe. The objective of the ENIAC EEMI-450 and CASA-450 programs is "to improve the competitiveness of the European semiconductor equipment and materials industry and therefore increase the chances to be selected by the tier 1 semiconductor companies in their future 450mm operations," said Bas Van Nooten, director of European cooperative programs for

ASM International

(ASMI)

. Van Nooten has been acting as a spokesman for EEMI-450.

A steering committee for EEMI-405 has been formed with representatives from ASM,

ASML Holding

(ASML) - Get Report

,

Siltronic

,

Soitec

,

IMEC

,

Recif Technologies

,

Fraunhofer Institut

of Integrated Systems and Device Technology (Fraunhofer-IISB) and two representatives from Intel.

Camp No. 3 is large, non-European semiconductor equipment manufacturers, including

Applied Materials

(AMAT) - Get Report

,

Novellus

(NVLS)

,

Lam Research

(LRCX) - Get Report

,

TEL

and others, which publicly have slammed the idea of the 450mm wafer transition.

Camp No. 4 is Semiconductor Equipment and Materials International, a consortium of worldwide equipment and materials manufacturers that is sitting on the sidelines (to be fair, the SEMI M74 standard relates to wafer transport and handling for IC manufacturing and is intended to support research and development for design investigation of wafer carriers, load ports, AMHS, and robotics for early 450mm equipment development).

The Information Network is aligned with Camp No. 3 and is against the deployment of 450mm wafers. Manufacturing with larger wafers helps increase the ability to produce semiconductors at a lower cost. The total silicon surface area of a 450mm wafer and the number of printed die (individual computer chips, for example) is more than twice that of a 300mm wafer.

A chipmaker, therefore, has to purchase only half the number of wafers and equipment to produce the same number of chips on a 450mm wafer than on a 300mm wafer. No wonder the leading equipment manufacturers are against it. Migration to 450mm will probably decimate the small and mid-sized equipment manufacturers, who (1) can't afford the development costs for 450mm, and (2) will lose half their sales.

Why does the Information Network say this? Look at the chart below. Production of semiconductors on 300mm wafers started in 1998 but didn't really take off until 2002 when 300mm wafers made up 2.2% of all wafers used. The 300mm wafers now represent more than 25% of wafers being manufactured and 49% in terms of square inches of silicon.

Prior to 2002, semiconductor and equipment revenue tracked together. After 2002, semiconductor revenue has continued to diverge from equipment revenue, and the ratio of equipment to semiconductor revenue is at an all-time low.

We attribute this divergence largely to the impact of 300mm wafers.

-- Written by Robert Castellano in New Tripoli, Pa.

Robert N. Castellano, Ph.D, is President of The Information Network, a leading consulting and market-research firm for the semiconductor, LCD, HDD and solar industries. Castellano is internationally recognized as one of the leading experts in these areas. He has nearly 25 years of expertise as an industry analyst. Castellano has provided insight on emerging technologies to many business and technical publications, including Business 2.0, BusinessWeek, The Economist, Forbes, Investor's Business Daily, Los Angeles Times Magazine, The New York Times, USA Today and The Wall Street Journal. He is a frequent speaker at conferences and corporate events. He has over 10 years' experience in the field of wafer fabrication at AT&T Bell Laboratories and Stanford University before founding The Information Network in 1985. He has been editor of the peer-reviewed Journal of Active and Passive Electronic Devices since 1985. He is author of the book "Technology Trends in VLSI Manufacturing," published by Gordon and Breach. His book "Solar Cell Processing" was published in 2009 by Old City Publishing. He received his Ph.D. in solid state chemistry from Oxford University.