January 22, 1998 (TAIPEI) -- Prospects for the semiconductor
industry in 1998 look dimmer than those of 1997 due to an
oversupply and the financial crisis in Southeast Asia, warned
Donald Brooks, chief executive officer of United Microelectronics
Corp.'s (UMC's) International Operations department.
Brooks made these remarks in a recent seminar on semiconductor
technology held by UMC in San Francisco, CA. This was the second
seminar of its kind held by the Taiwan semiconductor heavyweight
since its transformation into a wafer foundry maker.
Brooks pointed out that wafer foundries have seen their share of
the world's overall semiconductor output increasing each year. In
1997, such manufacturing accounted for less than 10 percent of
all semiconductor output.
"By the year 2000, however, the figure is expected to climb to 20
percent," said Brooks. "The mushrooming of integrated circuit
(IC) design companies was the major cause of the rapid growth of
the wafer foundry sector."
Fabless IC design companies reported an output value of US$6.8
billion in 1996, and the figure is estimated to reach US$22.8
billion by 2001. This marks a 27.4 percent compounded average
growth, and the entire semiconductor industry is only expected to
see growth of just over 10 percent, according to Brooks.
Due to this expansion, Brooks warned, the world is likely to see
an oversupply in the wafer foundry industry.
Both UMC and the Taiwan Semiconductor Manufacturing Co., the
biggest wafer foundry makers in Taiwan, have been actively
expanding production lines. Many companies in Southeast Asia also
have vowed to devote themselves to such manufacturing.
"Despite the fact that many of these companies have yet to take
any concrete action, financial jitters in Asia are likely to
reduce demand for semiconductor products," said Brooks.
(Commercial Times, Taiwan)