Miss Marple & A letter home from San Francisco ...
Greetings from San Francisco. As I will be leaving here shortly for my long journey back to St. Mary Mead, I want to follow through on the promise of my earlier letter to tell you about my visit to the convention that took place here in this city several weeks ago. You may ask why I have lingered in San Francisco if the purpose of my visit has long since come and gone. Let me assure you that this is a place that is not only well worth visiting, but one that warrants an extended stay. The city itself is marvelous – the people relaxed and friendly, the choices of cuisine diverse, the views out to the Bay or the Ocean or the bridges quite spectacular, and the weather not nearly as off-putting as I had been lead to believe it would be. In fact on the eastern side of this city, although frequently breezy, there are rarely days without bright sun or blue skies. And, there is so much going on here! Yesterday, I rose very early and found my way by taxi and on foot to the southern end of the majestic Golden Gate Bridge. There I will admit, at 5:30 in the morning, it was foggy and dark and incredibly damp. It was as if the towers of the bridge, or the bridge itself, were simply not there. However, the grueling San Francisco Marathon was underway and there were so many dogged and determined runners to watch, it was not necessary to see the bridge to enjoy the spectacle. Over the next several hours as the sun rose and the fog lifted, the race continued on into the legendary Haight-Ashburry District. As that part of the city is also quite unique – and distinctive from the downtown area – I realized that had I left several weeks ago as planned, I would have missed these additional aspects of life in this place. I have been told that the Design Automation Conference will be here in San Francisco next July for the first time in many years. From what I have seen over these last several weeks, I cannot at this moment think of a more delightful circumstance. The new art museum in Golden Gate Park will have opened – the building is an enigmatic work of art in itself – and will join the list of must-see museums already here: The Museum of Modern Art, The Asian Art Museum, and The Legion of Honor among others. Clearly, even on a foggy day – if you'll excuse my whimsy – San Francisco is a place that is magical in its beauty and allure. But I digress. The conference that took place here in mid-July was serious business, and there was no magic about it at all. They call it Semicon West and I believe tens of thousands of people attended from all over the world. Moscone Convention Center, which consists of three enormous halls arrayed along several streets, was filled to the bursting with booths, exhibits, people, barkers, meetings, presentations, and demonstrations. If you suffer in large crowds or frenetic places, Winifred, this was not the place for you! Semicon West took place over the course of four or five days; I dutifully attended on the Monday and the Wednesday. The other days, quite honestly, I found it more interesting to do other things – which is not to say that I didn't learn anything on the days I did attend, because I did. However, there is only so much that one can learn about the business and manufacturing of semiconductors before one wants to go off and live the life that those same semiconductors are supposed to be enhancing, enriching, improving, etc. On Monday, I was lucky enough to attend the lunchtime press conference and panel discussion hosted by SEMI – the organization that mounts these conventions here and in other venues around the world. After the lunch event, I spent a long afternoon attending the "SEMI Market Symposium" which consisted of 5 consecutive presentations that addressed the current state of affairs in the global semiconductor industry. Speakers included: Kevin Kettler from Dell As I am at this moment looking at copies of their presentations – kindly made available to the hundreds who attended this event – I am able to pinpoint some of the highlights of the afternoon. Among the things we learned – the consumers of the world are driving the semiconductor industry and Dell loves the consumer. We also learned that Dell is large enough and clever enough to be able to tweak its business model and its manufacturing practices to reflect the changing nuances of their market. In addition – Dell has big power problems, believes that integration on silicon is the challenge, that standards are sorely lacking, and that software needs to be developed more quickly and in closer alignment with the hardware it will run on. Most importantly, Dell believes we need to think collaboratively. I was inspired by the Dell presentation, although I couldn’t decide if I was inspired to think collaboratively or inspired to rush out and buy a very large plasma-screen television. When the people from Gartner and SEMI spoke, it was not so much about problems or products as about bar graphs, arrows, and forecasts of numbers that go up and numbers that go down. I observed that numbers never seem to stay static when people talk about semiconductors. (Fascinating discussions, all told, although at times it was helpful to be sitting adjacent to the coffee station.) Best I could understand, the demand for semiconductors is going up – what with the consumers' burning need for TVs and computer screens that are thin and flat, digital cameras, portable music players, cell phones, and cars that go beep in the night – but the demand for the equipment to manufacture those semiconductors is going down. To be honest, Winifred, I'm not entirely sure how that is possible. Nonetheless, it would appear that a lot of semiconductor manufacturing equipment was purchased last year, so less will be purchased this year – about 12% less, or worse. However by next year or the year after, the people who make semiconductors should be buying more manufacturing equipment, and the world that revolves around Semicon will quite possibly be a magical one once again. The fact that demand is currently going up for the materials out of which semiconductors and their packages are made, would be the hint that the magic is indeed about to reappear. Culling pearls of wisdom for the afternoon's presentations: New business models will be required in the future to maintain the historical pace of innovation. The industry has shown an ability to adopt new business models to improve cost efficiency. Examples include the foundry model, 300mm wafers, and various R&D consortia. – Klaus-Dieter Rinnen There are 475 fabs worldwide, of which 45 are producing 300mm wafers. New nanomaterials will reduce the cost of displays. All aspects of circuit design, silicon fabrication, packaging and test must work in harmony to continue product optimization. Think bigger. Alliances, mergers, acquisitions are encouraged. Overall, I think the people in the audience who lasted through the entire afternoon learned a lot. There really was enough economic data presented – both macro and micro – to sink a ship, or float an industry. I personally was interested in Jim Walker's discussion of styles for stacking die inside of packages. There are all kinds of sandwiches being developed – bologna sandwiches, pastrami sandwiches, hoagies, subs, and open-faced. I was also interested to see his numbers related to the growth of the various foundries from 2003 to 2004. TSMC grew 31%, UMC grew 42%, Chartered grew 52%, and SMIC was the big winner at 167%. SMIC is, of course, in China – which brings me back around to a point hotly contested during the press lunch earlier that afternoon. The lunchtime presentations were more succinct than those during the afternoon, as there was only 90 minutes in total allotted for that event. The speakers included: Stanley Myers from SEMI I believe you can go on-line and find an actual videotape of this discussion, so I won't belabor the details. However, I did think the hotly contested point I referenced earlier was the core of the hour. Several people said that China would be building upwards of 20 additional fabs over the next year. Others thought that conjecture was nothing short of nonsense. In fact, the counter argument was that there are new fabs going up in the U.S., Japan and Europe, that the manufacturing of semiconductors is not all eventually going to be in China – far from it. The additional point was that China is purchasing used semiconductor manufacturing equipment, not new, because they are working to fill demand for legacy technology products, not leading-edge products. In the midst of this discussion at the press luncheon, there was a comment made about security issues related to China. It would appear that the economic power blocks in the world are conflicted here. They need this huge, emerging market. They must service this huge, emerging market. Yet, they are concerned about the long-term security implications of providing advanced technology to this huge, emerging market. This conundrum could not have been more clear in listening to the lunchtime discussion. And from what I heard, Winifred, it would appear the American Government is not at all oblivious to these issues. After the lunch was over and before people rushed off to the afternoon symposium, I had a chance to speak with George Scalise, who is the President of SIA – the Semiconductor Industry Association. His response to the question was quite spot-on, in my opinion: "Everyone in this industry wants to access the China market. But we also want to honor our national security concerns." With that, I need to end my letter as I must pack and go. I will be back in St. Mary Mead in a matter of days and look forward to telling you in greater detail about all I have seen and heard over this past month. In the meanwhile, I will leave you with this thought. If you are interested in economics, If you are interested in geo-politics. If you are interested in peacetime and wartime applications of technology. If you are interested in physics, chemistry, electronics, or material science. If you are interested in people and the quirky things they think are important to lead a useful or comfortable life. If you are interested in numbers that go up, go down, and go back up again. You simply cannot fail to be interested in everything that happens at events like Semicon West. And that holds true for events like the Design Automation Conference or the Advanced Reticle Symposium. After all, ultimately these are real people dealing with real issues and attempting to use real science and engineering within the context of real economic and political considerations to move the state of humankind forward to a real place that is better than the one we occupy today. I look forward to seeing you soon. Please don't forget to water the roses. Warmest regards, Jane Marple ******************************** P.S. A final item from Jim Walker's presentation: To deal with the future, one needs: * Imagination and innovation applied to the business model to weather the storm and create stronger companies, Good news for those who provide third-party design tools. Don't you agree, Winifred? ********************************
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