UMC to double 90-nanometer chip shipments by Q4

Taiwanese chip maker UMC says it will double its monthly shipments of cutting edge 90-nanometer chips by October due to strong demand.

Taiwanese contract chip maker United Microelectronics (UMC) said Monday it will double its monthly shipments of cutting edge 90-nanometer chips by October due to strong demand for chips used in a broad range of devices.

The 90-nanometer chips are being made for wireless and wire-line communications devices, high-end consumer products and advanced computing systems, among other things, UMC said. A nanometer is a measurement of the size of transistors and other parts that are etched onto chips. The more transistors on a chip, and the closer they are together, the faster the chip can perform tasks.

Some of the most significant products are using SOC (system on a chip) designs, UMC said, combining two or more functions on one chip. This not only helps make them more powerful but it reduces the number of parts going into devices, and that can mean cheaper, smaller, more compact products.

The company noted the recent announcements of a single chip GSM (Global System for Mobile Communications) product with a baseband and RF (radio frequency) transceiver, as well as Bluetooth and 802.11 a/b/g wireless LAN products that integrate baseband and RF.

The announcement signals a move into the mainstream for 90-nanometer technology among a broad range of chip designers, after being on offer for the past few years by UMC and rival Taiwan Semiconductor Manufacturing (TSMC). Heavy chip design costs curtailed early use of the technology, but the need to make chips smaller to fit today's ever-shrinking gadgets, power savings and other improvements offered by the technology, as well as some cost reduction measures, have moved the technology forward.

The 90-nanometer production technology has been used for a while by Intel and other companies with mass-produced products. Makers of DRAM (dynamic RAM) computer memory chips, like Samsung Electronics have also increased their use of the technology over the past year.

UMC, the world's second-largest contract chip manufacturer, produced 90-nanometer chips on 10,000 silicon wafers in July, the company said, and it expects to double that number by the fourth quarter.

Chips are made on silicon wafers about the size of dinner plates. Thousands of chips can be made on each wafer.

The 90-nanometer chip shipments accounted for 9 percent of UMC's revenue in the second quarter, and the company expects them to make up 15 percent of its third quarter revenue, the chip maker said.

TSMC's 90-nanometer manufacturing technology is expected to account for about 10 percent of its revenue in the third quarter, up from 2 percent in the second quarter, the company said last month. Chips made using TSMC's 130-nanometer technology and smaller accounted for 43 percent of revenue in the second quarter.