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No. 360, September 1999

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American Companies in Japan


The world semiconductor industry has been in a constant state of flux over the last two years or so, with new production alliances being forged just as long-standing ones are dissolved. By the end of 2000, the latter category will include the Sendai, Miyagi prefecture wafer-fabrication venture between MOTOROLA INC. and TOSHIBA CORP. The big American chipmaker has agreed to buy out its equal partner in TOHOKU SEMICONDUCTOR CORP. on terms that were not disclosed. The company, now capitalized at $44.2 million, was formed in 1987 primarily to give the two access to each other's technical strengths: DRAMs for Motorola and microprocessors and other logic devices for Toshiba. Memory production ended in 1997 after Motorola decided to exit the DRAM business. Since then, both of TSC's front ends have been used for logic products, which currently include microcontroller units, flash-embedded MCUs and DSPs (digital signal processors). Toshiba apparently decided that it had derived all the benefits from the manufacturing tie-up that it could achieve and initiated talks with Motorola about the future of TSC. After the firm becomes a wholly owned Motorola subsidiary, it will make Digital DNA embedded processors, which are used in consumer, networking and computing, transportation and wireless communications applications. Motorola says that none of Tohoku Semiconductor's 1,400-plus jobs will be lost. In fact, Motorola is in the process of integrating its Japan semiconductor operations in the Sendai area. About 60 percent of the 1,000 people who work for NIPPON MOTOROLA LTD.'s semiconductor division are being transferred there, including R&D staff. In a totally unrelated decision, Toshiba recently agreed to buy out INTERNATIONAL BUSINESS MACHINES CORP.'s half interest in a Virginia DRAM wafer manufacturing venture (see Japan-U.S. Business Report No. 359, August 1999, pp.8-9).

ON SEMICONDUCTOR, L.L.C., the world's largest maker of discrete, standard analog and standard logic semiconductor components, is the newest player in Japan's semiconductor market. The Phoenix, Arizona-headquartered company was formed in August when TEXAS PACIFIC GROUP bought part of MOTOROLA INC.'s semiconductor business. ON Semiconductor is the trade name of SCG HOLDINGS CORP. Its new Tokyo sales, marketing and customer-support subsidiary goes by the name of SCG JAPAN LTD. Among ON Semiconductor's far-flung manufacturing locations is a wafer-fabrication complex in Aizu, Fukushima prefecture that Motorola opened in 1980 to make logic and memory products.

Four midsize American chipmakers also have moved into the Japanese market, all by tying up exclusively with NIHON DENKEI CO., LTD. This Tokyo company, a marketer of electronic measuring instruments, is representing: ANALOG MICROELECTRONICS, INC. of Santa Clara, California, which specializes in analog chips for measuring equipment; AUSTIN SEMICONDUCTOR, INC., an Austin, Texas supplier of high- reliability memory products and memory modules for the space and military industries; Sunnyvale, California-based CERMETEK MICROELECTRONICS, INC., which provides chips for modems; and neighbor IMPALA LINEAR CORP., a maker of DC/DC converters for mobile phones and other communications products. Nihon Denkei believes that each of the four company will have local sales of anywhere from $885,000 to $1.8 million the first year.

For its part, market newcomer DVDO, INC. named MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. to distribute its line of video-processing ICs to manufacturers of digital TVs, projection systems and flat-panel displays. The Campbell, California firm's newest product, the DV101 Image Enhancement Engine, incorporates its PureProgressive video-enhance-ment technology. It will be the first DVDO chip that MEI handles. The part will be marketed to makers of digital TV, LCD, plasma, DLP (digital light processing) and other progressively scanned display devices.

In conjunction with its stronger emphasis on Asian sales, RADISYS CORP., a supplier of Intel-based embedded chipsets, signed ASAHI ELECTRONICS CO., LTD. and OKAYA ELECTRONICS CORP. to market its products to OEM customers in the communications, industrial automation and other fields. Both companies already distribute INTEL CORP. processors and associated parts. Hillsboro, Oregon RadiSys has a subsidiary in Yokohama.

The fastest Pentium III processor that INTEL CORP. has developed is shipping to computer manufacturers in Japan as well as in the United States. The 600-MHz version of the chip is designed to deliver the full power and richness of the Internet to Web surfers as well as to enhance such business applications as e-com-merce, data visualization, streaming audio, video and speech recognition. In the United States, the 600-MHz Pentium III with 512 KB of L2 cache costs $670 each in quantities of 1,000 units. The high-end processor now is available in speeds of 450 MHz, 500 MHz, 550 MHz and 600 MHz.

In another worldwide release, INTEL CORP., which claims the title of the world's top maker of flash memories, announced the 3-Volt Intel StrataFlash with triple the read performance of its predecessor. The result of 0.25-micron processing technology, the part enables both code execution and data storage on a single, high-density 128- megabit chip. The 3-Volt Intel StrataFlash also is said to offer the most storage in a NOR-type flash device. These capabilities give new design options to manufacturers of handheld devices, smart phones, PC companions, networking equipment, set-top boxes and other Internet-connected appliances. Volume shipments of 128-Mb 3-Volt Intel StrataFlash parts were set for September at U.S. prices of $29.90 each in 1,000- unit quantities. In the first quarter of next year, Intel is scheduled to introduce 32-Mb and 64-Mb versions of the new part.

Users of SUN MICROSYSTEMS, INC.'s 3000 to 6500 Enterprise servers now can double the top factory-installed system memory of these Unix products, thanks to the 2- GB DRS702/2048 memory board from DATARAM CORP. The Princeton, New Jersey manufacturer selected COMPUTER DYNAMICS CORP. to market the $14,800 product. The Tokyo distributor thinks that it can sell 1,000 boards a year to the substantial number of Sun installations in Japan.

SIRF TECHNOLOGY, INC. — a developer of chipsets that deliver the locational benefits of GPS (global positioning system) technology to wireless handheld products, car navigation systems, PC-based platforms and consumer devices — has licensed its intel-lectual property to two more Japanese companies. NTT MOBILE COMMUNICATIONS NETWORK, INC. will integrate the Santa Clara, California company's just-announced SiRFLoc know-how into its DoCoMo Location Platform. SiRFLoc is a platform-specific technology that improves GPS location capabilities in wireless systems. At the same time, AISIN AW CO., LTD. incorporated SiRF's GPS architecture into its line of car navigation systems.

In another design win for an American company, the PM-44+ iDSP from OAK TECHNOLOGY, INC. is the imaging solution for select scanners and digital copiers introduced by FUJITSU, LTD. and HITACHI KOKI CO., LTD. Fujitsu integrated the Andover, Massachusetts company's part into its M3090 series of departmental and production scanners, while Hitachi Koki used the chip in its DDS32 digital copier, the company's first such product. Oak Technology's iDSP family is said to represent the only line of DSPs designed specifically for digital imaging equipment. It combines high image-processing throughput rates with the flexibility of a programmable DSP architecture.

HEWLETT-PACKARD JAPAN LTD. named MACNICA, INC. to distribute a pair of CMOS color image sensors with digital output and timing controller for such applications as PC cameras, digital still cameras and surveillance and security video cameras. The difference between the two sensors is the array size: 640 x 480 (the HDCS-2000) or 352 x 288 (the HDCS-1000). Both are said to offer excellent image quality with low power consumption.

With technical input from SONY CORP., the promoter of the Direct Stream Digital format for Super Audio CD players, BURR-BROWN CORP. developed the DSD1700. It is the Tucson, Arizona manufacturer's first DSD audio digital-to-analog converter. In combination with Sony's DSD decoder, the part will deliver the high performance and the sound quality that DSD technology promises. Sampling of the DSD1700 will start later this year. It is targeted to be priced at $14.50 per unit in quantities of 100.

In a somewhat surprising move, AMERICAN MICROSYSTEMS, INC., a Pocatello, Idaho supplier of mixed-signal ASICs (application-specific ICs) and other semicustom mixed-signal devices, outsourced assembly and testing of certain plastic-packaged parts to FUJI-TSU VLSI, LTD. The deal marks the first time that the wholly owned FUJITSU, LTD. company has won a contract from a company outside the Fujitsu Group. Fujitsu VLSI will handle back-end processes for roughly 10,000 AMI chips a month at its facility in Gifu prefecture. AMI, a JAPAN ENERGY CORP. company, will do final inspection.

Under an arrangement that will expand the availability of TESSERA INC.'s chip-scale packaging, especially in Japan, the San Jose, California company licensed its Micro BGA (ball-grid array) technology to NORTH CORP. The agreement specifically covers the Tessera Compliant Mounting Tape technology, which is used in the assembly of Micro BGA packages. North will provide the tape to Tessera contract assembly licensees that make the package.

Effective September 1, the complete product portfolio of the Eaton Semiconductor Equipment Operations unit of EATON CORP. will be represented in Japan by SUMITOMO HEAVY INDUSTRIES, LTD. Last April, Beverly, Massachusetts-based Eaton Semiconductor gave SHI the job of selling, distributing, servicing and supporting its thermal processing equipment line. Now, it has transferred responsibility for sales and support of its resist-strip and photostabilization equipment to SHI from TOKYO ELECTRON LTD. This centralization is a natural extension of the 15-year, Toyo, Nagasaki prefecture-based production and marketing joint venture between Eaton Semiconductor and Sumitomo Heavy Industries on the Eaton Nova line of ion implantation equipment.

APPLIED MATERIALS, INC., the world's largest supplier of wafer fabrication systems, has introduced two more products in Japan. One is the SiNgen Centura, a single- wafer, low-pressure chemical vapor deposition system for depositing critical silicon nitride film layers in the transistor structures of 0.18-micron and smaller devices. The Santa Clara, California manufacturer notes that SiN films have an increasingly significant impact on chip performance as line geometries move below 0.18 micron. The $2.7 million or so SiNgen Centura combines Applied Materials' production- proven, single-wafer xZ chamber technology and Centura platform with a state-of-the- art nitride deposition system. The second new product is the Mirra chemical mechanical polishing system with its throughput of more than 50 wafers an hour. The Mirra, which also costs about $2.7 million, features the Titan Head wafer-polishing carrier. It rotates the wafer during the polishing process and, according to Applied Materials, provides uniformity and repeatability among wafers. The other strength of the Mirra, the company says, is technology that detects film thickness changes during polishing. This capability allows the user to precisely define material removal and, thus, the process endpoint.

An exchange rate of ¥113=$1.00 was used in this report.aaaaaa

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