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No. 350, November 1998

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Japanese Companies in the US


SEMICONDUCTORS

Within the space of a week, two big Japanese semiconductor manufacturers announced relationships with CENTILLIUM TECHNOLOGY CORP., an 18-month-old fabless chip company developing DSL (digital subscriber line) chipsets for makers of telecommunications equipment. MITSUBISHI ELECTRIC CORP. and the Fremont, California firm tied up to deliver chipset and system-on-a-chip solutions for the DSL market. Their collaboration has resulted in a xDSL ASIC (application-specific integrated circuit) that integrates Centillium's digital signal processing technology with MELCO's high-speed static RAM technology. The alliance gives the start-up production capacity as well as help in providing higher levels of xDSL performance by integrating additional key DSL system functions into a single chip. In addition, MELCO joined MITSUBISHI CORP., SUMITOMO ELECTRIC INDUSTRIES, LTD. and other companies in investing in Centillium.

For its part, NEC CORP., among the biggest Japanese telecommunications equipment manufacturers, named CENTILLIUM TECHNOLOGY CORP. its DSL chipset supplier. Under the four-year agreement, NEC will integrated the start-up's CopperLite chipset into a family of DSL access multiplexers for worldwide sale. Executives said that they chose the CopperLite chipset because it is easy to deploy, has low power requirements, enables high-density solutions and will be compliant with the forthcoming G.Lite/DMT international standard for DSL products. NEC's DSL access multiplexer line is expected to be released in the first half of 1999.

HITACHI SEMICONDUCTOR (AMERICA), INC., which shuttered its DRAM plant in Irving, Texas at the start of September (see Japan-U.S. Business Report No. 349, October 1998, p. 7), signed deals with two companies to produce memory modules for its PC customers. Fountain Valley, California-based KINGSTON TECHNOLOGY CORP. will provide global manufacturing and testing for Hitachi Semiconductor's PC- 100 memory modules. It reportedly is the first non-HITACHI, LTD. company to qualify to make these products. Kingston, the dominant force in the American PC memory board market, has been 80 percent owned by SOFTBANK CORP. since the fall of 1996. Similarly, TANISYS TECHNOLOGY, INC. will employ its quick-turn build-to-order program to design, make and supply memory modules for Hitachi Semiconductor's OEM customers. North American PC buyers will be serviced from the company's headquarters plant in Austin, Texas, while orders from European customers will be filled at a Tanisys facility in Scotland.

Both to better insulate itself from the vagaries of the memory market and to capitalize on expanding demand, TOSHIBA CORP. plans to strengthen its ASIC business in the United States. It will bolster its lineup of the custom-made devices, which are finding more applications in communications equipment and digital consumer electronics products. At the same time, Toshiba will launch a more aggressive marketing campaign among heavyweights in the American networking equipment market.

An exchange rate of ¥121=$1.00 was used in this report.
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