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January 6, 1987

IBM LEADS PUSH FOR US CHIP CO-OP

By CBR Staff Writer

Uncharacteristically, IBM is leading the pressure from the US semiconductor industry and its users – led by the Department of Defense – for the formation of a consortium company capable of pulling back the lead held by Japan Inc in commodity memory chips and semiconductor fabrication equipment. According to the New York Times, without IBM’s energetic lobbying, the venture, sponsored by the Semiconductor Industry Association and dubbed Sematech, would not have much chance of getting off the ground, but is being taken seriously because of the IBM connection. Although IBM makes almost all its own chips, and designs much of its fabrication equipment, it doesn’t want to have to make all the latter – or be dependent on Japanese manufacturers. The plan is for Sematech to develop advanced chip manufacturing technology and to prove it by manufacturing 4K-bit or 16K-bit dynamic RAMs, which would likely to be sold to member users. As well as that of IBM, the Sematech plan has the backing of DEC and Hewlett-Packard as users, and the other prime movers are the five biggest US chipmakers – Texas Instruments, Motorola, Intel, National Semiconductor and AMD – and NatSemi’s Charlie Sporck is chairing the project committee. The biggest question mark is where the annual funding of $250m or so will be found: the Pentagon is not likely to get Congressional approval, and many of the firms are already short of cash and unable to contribute much, so that Sematech may have to try to raise cash on Wall Street.

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