Matsushita unveils digital TV chip

TOKYO: Consumer electronics maker Matsushita Electric Industrial Co unveiled

on Tuesday a chip for high-definition digital TVs aimed at cementing its

dominance in that potentially high-growth segment of the semiconductor market.

The chip, set to enter volume production later this year, will reduce costs,

boost processing speed and cut power use by putting on a single piece of silicon

the processor, graphics, memory and other functions previously divided among two

chips.

It is also part of Matsushita's efforts to recover its status in the industry

with hit new products, after posting record losses last year and ceding the top

spot among the world's consumer electronics makers to arch-rival Sony Corp.

"This chip will support the products that lead Matsushita's

recovery," Susumu Koike, head of the company's semiconductor operations,

told a news conference. In addition to processing digital satellite TV signals,

the chip will be able to handle land-based digital broadcasting, due to start in

Japan's largest metropolitan areas next year and go nationwide by 2006.

With tweaks to its software, it can also be adapted to high-definition

digital broadcasts in other countries, the company said. Matsushita holds a 50

per cent market share in microchips that are the brains of high-definition

digital TVs, and it hopes to maintain that lead as digital TV comes of age in

the years ahead and rival chipmakers step up their efforts.

Of particular concern is STMicroelectronics, which dominates the chip market

for standard digital TVs.

Last year the Franco-Italian firm leapt into the number-three spot among

global chipmakers, propelled in large part by its focus on so-called

"system chips", which combine several functions on a single piece of

silicon and are designed for specific products such as consumer electronics or

automobiles.

Japan's big chipmakers, hit by billions of dollars in losses after last

year's record-breaking chip slump and fierce competition from leaner foreign

rivals, are also abandoning standard memory chips and shifting to system chips.

Matsushita will make the new chip at a factory in Japan using advanced

processes, including narrow 0.13-micron circuitry, developed in cooperation with

Mitsubishi Electric Corp, Japan's fourth-largest chipmaker.

Only a handful of Japanese chip factories currently use 0.13-micron

circuitry, which leading global chipmakers such as Intel Corp have adopted

aggressively to cut costs and boost chip performance. Matsushita aims to begin

sample shipments of the new chip in August at 20,000 yen ($169) a piece, with

volume production of 40,000 to 50,000 chips per month scheduled to start in the

second half of the business year to March 2003.

(C) Reuters Limited.