At the end of last year National Semiconductor Corp agreed to sell its photomask operation to DuPont Co and Texas Instruments signed a letter of intent to divest its mask shop to Toppan Printing of Tokyo (CI Nos 1,330, 1331) – so what lies behind these moves by US semiconductor companies to divest their capability in one of the core processes in chip fabrication? Industry observers say that photomask fabrication business is currently unprofitable due to the high cost of electron-beam machines and other neccessary equipment. The belief is that companies could better deploy their capital by closing their internal mask shops and spending more money on their chip fabrication areas. Others see the handing over of these technologies to Japanese companies as running against US national interest, but Texas believe the proposed deal will mean that Toppan will focus the resources and capital needed to provide a continuing source of technologically-superior and reliable photomasks. But it will also strenghten the presence of Toppan, the world’s second largest merchant mask supplier, within the US market. This year may see major competition between US champion DuPont, which has spent over $150m on the market in the past three years and is making a stand to preserve a strong US presence in this crucial market, and the Japanese mask vendors that supply Matsushita, Hitachi, NEC and other semiconductor makers who also want more market share in the US and Europe. Though many chipmakers would prefer to use merchant vendors for their mask needs, IBM, AT&T Co and Intel Corp say they have no plans to divest their mask operations, saying they want total control over their device fabrication.
