Oki turns to UMC to make new ASIC line
Faith Hung
EBN

03/11/2003 8:29 AM EST
URL: http://www.eetimessupplynetwork.com/7600056

TOKYO -- Oki Electric Industry Co. Ltd. will employ the foundry facilities of United Microelectronics Corp. to make a new ASIC product line.

Oki Electric will use the 0.15-micron process technology of UMC, Hsinchu, Taiwan, to make the MG7xK family, according to a statement from Oki Electric. The new product line, which the Tokyo-based company is poised to begin marketing next month, is expected to generate sales of $86 million over three years, said a company spokesperson.

The foundry agreement marks the first milestone following a partnership the companies announced last September. Oki plans to migrate to the more advanced 0.13-micron ASIC products using UMC's fabs within the next year.

By integrating design rules and process parameters with UMC, Oki Electric's new ASICs can cut the time for development and production to less than six months, the statement said. That's less than half the industry norm of 12 to 18 months, it added.

The latest agreement between Oki Electric and UMC is likely to pave the way for Japanese IDMs (integrated device manufacturers) to increasingly farm out their high-end production to pure-play foundry service providers like UMC and Hsinchu-based Taiwan Semiconductor Manufacturing Co., Ltd., some analysts said.

"Japanese IDMs have suffered from overcapacity in the last few years, so they haven't outsourced as much as people have expected them to," said George Wu, an analyst at Primasia Securities Co. in Taipei. "But they should gradually start using TSMC's and UMC's 0.13-micron and below process technologies, because they have hardly invested in the technologies."

The other foundry partner of Oki Electric is Grace Semiconductor Manufacturing Co., Ltd., which is based in Shanghai, China, said the spokesperson. Oki Electric licenses process technologies to GSMC, and in turn the Chinese foundry provides 0.22-micron to 0.25-micron memory chips to Oki Electric, she said.

Under the latest alliance, Oki Electric customers are allowed to access various Oki Electric IP offerings through UMC's Gold IP program, including ARM Processor cores, the statement said.

The new MG7xK family improves speed per gate by more than 30% and offers a 25% reduction in power consumption, it said. This system ASIC is used in network equipment, PC peripherals, and general electronic appliances.