Gartner Dataquest Forecasts Increased Demand for Silicon Wafer Market in 2003; Analysts Say Demand to Increase With Startup of 300mm Fabs

Business Wire, Dec 19, 2002

Business Editors

SAN JOSE, Calif.--(BUSINESS WIRE)--Dec. 19, 2002

Silicon wafer demand will begin a major expansion between the second half of 2003 and 2004, as it will be driven by a combination of a recovery of device demand and the startup of 300mm fabs, according to Dataquest Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).

Gartner Dataquest analysts said there will be some delays in 300mm fab projects because of feared cutbacks of capital spending by semiconductor vendors. However, there will be increased demand in the second half of 2002.

"At present, 300mm wafer demand is estimated at approximately 200,000 of wafers per month. It will grow rapidly with the reinvigoration of 300mm fab projects and is expected to reach a level of 440,000-450,000 of wafers per month in the fourth quarter of 2003," said Takashi Ogawa, principal analyst for Gartner Dataquest's semiconductor manufacturing research group. "Coupled with the 300mm wafer demand ramp-up, total silicon demand will expand appreciably at the annualized pace of 23 percent in 2004 and will reach 6,147MSI."

Fab capacity is expected to move to the Asia/Pacific region at an accelerated pace, and the region will hold a larger share of wafer demand in the world market. In contrast, Japan will lose share because of the continued relocation of electronics production, the increased use of foundry service, and consolidation of local semiconductor operations.

"Leading Japanese vendors, such as Elpida and Toshiba, recently announced their intent to invest in 300mm fabs," Ogawa said. "While the regional shift of fab capacity is an irreversible mega trend at this moment, it's worth watching how 300mm fab projects of Japanese vendors will affect the regional distribution of wafer demand in the future."

Additional analysis is available in the Gartner Dataquest Alert "Silicon Wafer Market Outlook: Modest Growth Expected in 2003." The Alert provides an outlook for silicon demand on a quarterly basis, as well as a yearly forecast through 2007.

This research is produced by Gartner Dataquest's Semiconductors Electronic Manufacturing Worldwide Cluster Research. This research is designed to help companies focus on opportunities in semiconductor manufacturing and procurement covering the entire value chain of services, equipment and materials on through to the procurement of chips. More information about Gartner Dataquest semiconductor programs and reports can be found in the Gartner Semiconductor Focus Area at http://www.gartner.com/semiconductor-mkt. To subscribe to this service, please call 408-468-8000. Reports can be purchased on the Internet at www.gartner.com .

Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry.

Gartner, Inc. is a research and advisory firm that helps more than 10,500 clients leverage technology to achieve business success. Gartner's businesses consist of Research, Consulting, Measurement, Events and Executive Programs. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, and has 4,000 associates, including more than 1,000 research analysts and consultants, in more than 75 locations worldwide. Fiscal 2002 revenue totaled $907 million. For more information, visit www.gartner.com .