The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

June - 2001 - issue > Cover Feature

When the Chips are Down ...

Monday, November 17, 2008

On the PC side, machines with 1GHz or faster processors carry paltry price tags of under $1,000, a sure indication that the market for state-of-the-art machines is stagnant. Communications IC companies like Broadcom and Conexant — perhaps the last stock market darlings of the recent high-tech boom — face a major slowdown in demand from network equipment builders stung by the sudden infrastructure glut. Fabless semiconductor firms are cutting back, and factories, or “fabs,” like Taiwan’s TSMC are reportedly running at only 60 percent capacity.
But semiconductors have seen cycles before. The recent craze for communications chips, which has left too many private companies in the market gasping for air, can perhaps be likened to the craze not long ago for graphics chips. However, the question remains: Is this slowdown any different? And will the industry recover any time soon?

From a stock market perspective, it’s unlikely that things will pick up this year. But there is more to life, and an industry, than the Nasdaq. Will innovation carry the day? And what are the prospects for semiconductor growth in India?

What does Intel think of all of this? After all, Intel is the largest player in the space by any metric. It’s time to see what real market forces will drive growth for Intel, as well as rival AMD. When the dust settles, the semiconductor industry will pick up as it has always done, as the networked economy gradually turns into a networked world where computing becomes totally entwined with people’s personal and professional lives. See how many people are carrying portable MP3 players instead of portable cassette players today. The evolution to a digital lifestyle is just beginning, and semiconductors will lead the way. For now companies must manage the slowdown.

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