[opendtv] Recovery based on CE
- From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
- To: "OpenDTV (E-mail)" <opendtv@xxxxxxxxxxxxx>
- Date: Mon, 7 Jun 2004 17:12:15 -0400
Interesting perspective.
> In an annual survey, the Synopsys Users Group reported that
> the average designs are now at 5 million gates, five times
> the typical chip density of just one year ago. Synopsys is
> tracking 150 designs at 90 nanometers and a couple of dozen
> at 65 nm, most of them assuming a world of 300-mm wafers
> with copper and low-k dielectrics in place.
>
> "The train is moving very quickly," de Geus said.
Oops. That "train" again. But this time, it might truly have
left the station, and I think this is how we're going to see
the price of DTT receivers drop dramatically. This in spite
of the much more cautious recovery we're in, according to the
article. Digital TV, among other CE products, it says, will
play a major role.
Bert
-------------------------------
A different kind of recovery arrives
By Rick Merritt , EE Times
June 01, 2004 (10:38 AM EDT)
URL: http://www.eet.com/article/showArticle.jhtml?articleId=3D21400577
SAN MATEO, Calif. - This is not your father's recovery. It's a
new day, many say, driven less by the familiar PC and more by
whims of consumer electronics, wireless and a market and supply
base more global than ever before. Despite a more mature,
conservative spirit, the industry has yet to sort out nagging,
knotty problems that start deep inside the silicon and extend
out into the far-flung supply chain.
"I hear the term recovery, but that sounds too much like the
normal up and down cycles," said Aart de Geus, chief executive
of Synopsys Inc. (Mountain View, Calif.), whose tools serve a
broad range of chip and systems designers. "What I think we
are in is a whole new and more mature phase of the electronics
industry." This new phase is colored by consumer electronics,
with its high-volume, low-price and high-integration chips.
It's a phase in which China and India have become key markets
and employment centers. And it's a phase in the midst of a big
technology transition.
In an annual survey, the Synopsys Users Group reported that the
average designs are now at 5 million gates, five times the
typical chip density of just one year ago. Synopsys is tracking
150 designs at 90 nanometers and a couple of dozen at 65 nm,
most of them assuming a world of 300-mm wafers with copper and
low-k dielectrics in place.
"The train is moving very quickly," de Geus said.
Sandeep Vij, vice president of marketing at Xilinx Inc. (San
Jose, Calif.), which supplies FPGAs to a smorgasbord of
electronics companies, talks about a recovery in shades of
paranoia. "Right now we're seeing a big uptick: In two quarters,
our business has gone up roughly 25 percent. The emotions have
ranged from wondering just eight months ago if the recovery
would ever happen to worrying about how are we going to get
enough wafers," Vij said. "People were hit so hard by the
downturn that there is a very guarded optimism. No one believes
this quarterly growth is sustainable. People are pretty
cautious about the summer. The thinking is there will be a
correction or moderation."
Indeed, Jim Feldhan, president of market watcher Semico Research
Corp. (Phoenix), has gone so far as to predict a mild recession-a
falloff of about 5 percent in growth-for 2005. Feldhan sees
continuing high federal deficits in the United States, a normal
post-election gross domestic product slump of about 2 percent and
a host of maturing 300-mm fabs in the U.S. and new 200-mm fabs in
China leading to a turnabout next year. "Our scenario comes up
with excess capacity, falling prices and a slowdown in the
semiconductor industry. The pieces all fit together," Feldhan said.
"But it doesn't have to be that way. If companies don't overbuild,
if they focus on profits and if end markets stay strong, we're OK."
"The downturn in 2001 and 2002 was twice as steep and twice as
long as previous downturns," de Geus said. "CFOs are very closely
watching costs. A burned child is afraid of fire."
That fear may be already be helping to moderate the next dip,
whenever it comes. Spending on new semiconductor capacity is only
about 60 percent of what it was in the 1995-1997 upturns, according
to Bill Ong, semiconductor equipment analyst at American Technology
Research Inc. (Greenwich, Conn.).
"Even factoring in improved yields and efficiencies, we believe the
spending levels for this upturn are not going to exceed the peak
levels of 1997, so we expect this [current growth] cycle to stay
extended," Ong said during a recent Web panel discussion.
Indeed, the ratio of capital spending to revenue hit a historic low,
of about 17 percent, in 2003, compared with about 30 percent at
their peak, said Joe Osha, a securities analyst at Merrill Lynch
(New York). "The businesses I follow have been through a brutal
three-year rationalization. Things managers can control are in as
good a shape as I have seen in awhile," Osha said.
Opinions range widely about this recovery.
Unemployed or merely skittish engineers in Silicon Valley talk
about the end of an era. They compare the eerie sight of new and
unoccupied glistening glass-and-metal office parks along Highway
237 to the abandoned brick Industrial Age factories of the East
Coast with weeds sprouting out of the cracks in the mortar.
Back in his Norwood, Mass., office, Jerry Fishman, chief
executive of Analog Devices Inc., takes a more pragmatic view.
"I think 2004 is going to be a good year. We are seeing demand
pick up pretty much across the board," Fishman said.
Indeed, vital signs are strong. The Semiconductor Industry
Association forecast in November that chip unit sales would grow
19.4 percent this year, and figures through February were a bit
stronger than expected, said Doug Andrey, SIA's principal
industry analyst.
Wall Street firm Lehman Brothers ratcheted up its forecast of
2004 semiconductor sales growth from 18 to 24 percent in a late
March research note. Cell phone shipments are expected to grow
as much as 15 percent this year and sport as much as 20 percent
greater chip content, according to the SIA. And U.S. spending on
business equipment and software was up 5 percent in 2003, a
possible sign of an IT upgrade cycle.
Consumer electronics have been helping to fuel the recovery,
Merrill Lynch's Osha noted. "We are in the middle of a good
display and portable product cycle, and there's a good digital
TV product cycle coming. It's remarkable how much memory consumer
electronics is soaking up," he said.
Vij of Xilinx talked about managers' playing "the beer game" with
drinks and snack chips to tease out what's really happening in
the extended train of global suppliers, manufacturers and vendors.
"The question is, Where is the demand in the supply chain?
Everyone is trying to get closer to end users," he said.
But "up to now," said SIA's Andrey, "there is no evidence of
accumulating inventory I have seen."
So even though 2004 may be a different kind of beast, "it still
looks pretty good," said Feldhan of Semico Research.
Copyright =A9 2003 CMP Media
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