"DRAM race is finished; Flash race is just starting"

EDN Asia: Can you say something about the new memory technologies Infineon is exploring?

Loh: With IBM, Infineon has been developing MRAM. Our alliance seeks to bring MRAM prototype from experimental status to preproduction. Though MRAM development still remains at an early stage, it is the most advanced of the next-generation memory technologies under develop-ment. We are testing the market with MRAM with a small amount of applications. As you go below 90nm, you have two technologies: com-modity RAM and specialty RAM. In the next application, commodity RAM will lose market share, and specialty RAM will dominate. This year-end Infineon is coming out with a new specialty product called Cellular DRAM. This DRAM is targeted at the mobile market. The migration of DRAM from PC to the smart phone, which will be very much like the PC, will phenom-enally change the memory market.

EDN Asia: What about technologies like organic RAM, ferroelectric, conductive bridging and phase-change RAM?

Loh: They are still far away. For instance, ferroelectric is at least five years away.

EDN Asia: What is the current state of the memory industry?

Loh: Memory industry has at last consolidated itself. There will be three players left: Samsung, Micron and Infineon. Perhaps even Hynix, which has shown some signs of turnaround. But as this turnaround is based not on state-of-the-art products but legacy products, one can't be sure about Hynix. Most players with a market share of 6 percent or less aren't expected to survive. DRAM race is finished; Flash race is just starting. Flash is free for all.

EDN Asia: Elpida is a serious memory player. It has recently declared that it will invest over $4 billion in capacity expansion.

Loh: Japan has missed out one generation node.






EDN Asia: True, but Japan is leap-frogging the missed-out node and reaching straight for 90nm.

Loh: The magnitude of challenge for doing so is very high. It has to be seen whether Japan succeeds.

EDN Asia: Can you say something about Infineon's technology initiatives in Asia-Pacific, like the $10 million incubator program?

Loh: The $10 million program is only for Singapore. We strategically invest in start-ups to help them grow. We have funds for other countries too, such as Taiwan and China. We identify small companies that can provide synergy to us if we help them grow, and pour funds into such companies.

EDN Asia: What is the level of designs Infineon carries out in Asia-Pacific?

Loh: Asia-Pacific used to be backend design center. Now it is a lead design center. India is among our most important software development centers. China offers a mixed destination. We do traditional designs as well as advanced ones in China. The design industry in Singapore is passing through a structural change. Four design houses have closed down, and consolidation of design houses is likely to happen here. Taiwan had gone through a similar phase some years ago. Taiwan foundries realized that for their own survival they needed design houses, and they played an important role in consolidation of design houses in Taiwan. The situation in Singapore is very much alike.

EDN Asia: As an OEM, what is your perspective about outsourcing?

Loh: If you want to be a leading player, you can't go fabless. You ought to have in-house competencies wherefrom innovation comes. In our business model, we manufacture products ourselves, have joint ventures, and also outsource to foundries. In memories, we have joint ventures with Nanya and Winbond, we outsource to SMIC, and also make ourselves. We aim at making 50 percent of memories ourselves. In logic, we have outsourced to TSMC, UMC and Chartered, yet aim at making at least 70 percent of logic ourselves.


You can reach Kirtimaya Varma at kirti.varma@rbi-asia.com