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US trade body hypes up chip growth

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US trade association the Semiconductor Industry Association (SIA) is pumping up the hype for the future of the market. In a press release issued late yesterday, the SIA said that global chip sales have risen to the double digit level, fuelled by the Internet. According to the SIA, growth next year is expected to exceed 15 per cent, amounting to some $162.5 billion. Those figures will continue through 2001 and 2002, with growth in the latter year of 12 per cent, amount to some $215.7 billion. The SIA quoted LSI Logic's CEO Wilfred Corrigan as saying the industry has now emerged from an "unprecedented three year slowdown". Factors included overcapacity, tight inventory management by OEMs and Asian financial woes. The trade association might have added that the overcapacity was caused by some of its members attempting to capitalise on the cost of DRAM back in 1995, and then finding themselves caught short when the subsequent glut happened. The resulting domino effect exacerbated the Asian economic crisis, has thrown untold numbers of people out of work, and the DRAM market is still in the doldrums... The SIA says the DRAM market demonstrates the overall volatility of semiconductors. It said that microprocessor revenues are set to grow by 16 per cent this year, compared to five per cent last year. ®

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