VLSI: Quake analysis has missed the boat

VLSI: Quake analysis has missed the boat

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VLSI Research CEO G. Dan Hutcheson also charged that some experts are spreading misleading data-instead of stating hard facts-about the electronics supply chain.

”There has been much dire commentary from experts as to how the earthquake could, might, or may be very disruptive to our industry. I underline these words, because it’s an old way to game the media for quotes,” Hutcheson said in a report. ”That said, it is true that the earthquake could, might, or may have been very disruptive to our industry.”

Hutcheson did not identify the culprits. Here’s the real problem in Japan: ”First of all, the primary source of problems for the industry is not the earthquake, nor even the tsunami. It was the low preparedness of Japan’s power industry,” he said.

”Moreover, most of Japan’s semiconductor production was not affected by the Tsunami either. The biggest issues currently affecting Japan’s semiconductor production are: power and transportation,” he said. ”If a fab is subject to the 3-hour rolling blackouts, it can’t run. Moreover, Japan’s rail systems run on electricity and their scheduling systems didn’t incorporate plans for such an event.”

What is the overall impact to the IC industry? ”The bottom line is that we believe the effect on semiconductor revenues for this year will be nil. There will be margin pressures, as limited supplies of raw materials drive prices up. But that is also being driven by growth and inflation in Asia,” he added.

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