Competition heats up in the chip market

SAN FRANCISCO: Xilinx Inc. said it is shipping samples to customers of its next-generation, customizable chips designed to take advantage of a new manufacturing process that promises lower costs. The chips are designed to allow electronics companies, automakers and other industrial companies to program them for specific uses. The chips, designed with new 90 nanometer process technology, will be available in volume in the second half of the year, Xilinx said.

With 90 nanometer technology, the space between the lines of circuitry is less than 1/1000 the width of a human hair. The current chip design technology in widespread use is 130 nanometer. Texas Instruments Inc. said in January that it was shipping samples of 90 nanometer wireless processors for use in cell phones and would ship them in volume in the fourth quarter of the year.

Intel Corp. says it is on track to have its 90 nanometer processors for personal computers commercially available in the second half of 2003. Unlike programmable chips, Intel and Texas Instrument's processors are sold in huge volumes to customers that do not need to program them for specific applications.

Xilinx's competitor in the market for programmable chips, Altera Corp., said it has had test versions of 90 nanometer chips since last year and plans to ship them in the first half of 2004. Xilinx is working with IBM on 90 nanometer technology development and will have Taiwan's United Microelectronics Corp. manufacture the chips. With the new technology, Xilinx said it can cut the size of the chips by up to 80 percent over existing programmable chips and lower prices.

The volume production of Xilinx's 90 nanometer chips will be done on silicon wafers that are 300 millimeters in diameter, compared with the current standard of 200 millimeters. The larger the surface of the disk the more chips that can be produced per wafer.

© Reuters