October 23, 2002...TriQuint Semiconductor, headquartered in Hillsboro, Oregon USA and regarded as one of the compound semi industry's major GaAs component and module manufacturers, will soon add InP expertise to their broadband communication capability, via their recently announced acquisition of Agere System's optoelectronic business, which is centered in Pennsylvania and Mexico. The acquisition involves $40 million in cash to Agere and the 300 target professionals from Breinigsville, Pennsylvania and Matamoros, Mexico which will be closely aligned to TriQuint's well-regarded "TriQuint Texas" GaAs-based Millimeterwave group, which is headquartered in Dallas. The Dallas operation is a well-proven MOCVD based manufacturing facility using Emcore platforms, that originated as part of Texas Instruments. Included from Breinigsville (which is equipped with both Emcore and Aixtron platforms plus IP that is rooted and heavily intertwined with the famed AT&T Bell Labs) will be approximately 80 development engineers, 20 marketing people, and 50 process engineers, plus 150 assembly & test manufacturing and engineering people in the Mexico, which is dominated by assembly and test. The Breinigsville operation has extensive capability in InP MOCVD manufacturing (among other compound semi-related technologies). Specific component capability from Agere includes lasers, detectors, modulators, passive components, arrayed waveguide-based components, amplifiers, transmitters, receivers, transceivers, transponders, and even a bit of MEMS capability. The agreement does not include Agere's optoelectronics components for CATV transmission systems, for which a separate buyer is still being sought. Ralph G. Quinsey, President and CEO of TriQuint, underscored that this was a natural fit for TriQuint... "This acquisition makes us one of the world's leading suppliers of optical modules and components. Clearly the market has been under a lot of pressure over the past two years, but we believe that this acquisition will position us for substantial revenue growth and profits when this market recovers. We are extremely excited about this opportunity." Through a transitional manufacturing agreement and to ensure seamless service to customers, Agere will supply components for TriQuint for a short period following the transaction closing, which is expected in January. More details can be found in The McDonald Report editorial, this issue, and in TriQuint's news release.

TDI Announces 2" p-Type GaN Templates Grown by HVPE

October 23, 2002...Technologies and Devices International, Inc. (TDI) of Silver Springs, Maryland, USA headed by wide bandgap pioneer Vladimir Dmitriev, has made another hefty contribution to GaN technology with their demonstration of 2-inch diameter GaN templates with p-type electrical conductivity, grown by Hydride Vapor Phase Epitaxy (HVPE). TDI's p-type GaN template consists of a sapphire substrate and high quality, highly doped, thick p-type GaN epitaxial layering. The technology breakthrough is expected to open even newer and wider application doors to GaN-based components. According to TDI, and based on current industry reported data, to date only n-type thick GaN layers have been grown by HVPE and the compound semi industry has been long awaiting p-type material. “This is the first sampling of p-type GaN templates by HVPE technology. The well-recognized benefits of GaN HVPE growth technology have included low production cost, high material quality, and high growth rate. Combining that with p-type doping capability opens an opportunity to design, develop, and fabricate novel GaN devices that were not previously possible”, said Vladimir Dmitriev, President and CEO of TDI. “Until now, lack of p-type GaN substrate materials has been a very real and, thereby, a limiting factor for realizing many new and important GaN device designs. TDI’s sampling of p-type templates, using our patented HVPE technology, opens a new avenue for GaN device development”. Realizing the importance of getting these into the merchant market as quickly as possible, TDI is planning to move p-type GaN templates into large-volume production in the first quarter of the year 2003. “Our experience in mass production of n-type GaN templates shows that it is a realistic goal, “ confirms Dr. Dmitriev. TDI has already begun shipping test samples of p-type GaN templates to prospective customers towards this goal. More details, including the technically important fact that the concentration of electrical carriers (holes) in TDI's p-type GaN layer can be varied in a wide range from 1016cm-3 to 1018 cm-3, are included in the TDI news release which includes excellent supplemental information for those unfamiliar with the details and differences of p-type and n-type GaN and their significance to the marketplace.

AXT Reports Continued Hard Times Buffered by Transition to China

October 23, 2002...Not every publicly held compound semi company's quarterly earnings rates news coverage, but AXT's earnings report does because that particular company, headquartered in Fremont, California (right in the middle of Silicon Valley which has been especially hard-hit by the market recession) is a major supplier of VGF starting material as well as offering leading edge LED products. Plus, AXT is one of the first to plant manufacturing roots in mainland China. The comments from Morris Young, President and CEO of AXT, tell it like it still is and where the action is... or isn't. "Economic conditions continue to pose challenges for our industry. Indium phosphide revenue continues to be affected by weak demand for telecommunications laser diodes. The volume of gallium arsenide substrates we shipped was relatively stable, but our revenues were impacted by a continued decline in average selling prices. Finally, revenues in our optoelectronics segment declined compared with the second quarter as we worked with our largest customer to qualify our latest generation of high brightness light emitting diodes. As a result of these continued difficult market conditions, AXT is reducing their staff, "particularly here in the U.S., using our inventory more aggressively in order to reduce materials purchases, and reducing capital expenditures. We are very proud of our success in transitioning to China and we believe that it will provide us with substantial cost advantages over our competitors," said Morris.

Intense Photonics Scores More Capital

October 23, 2002...Intense Photonics of High Blantyre, Scotland, which specializes in compound semi device manufacturing that revolves around Intense's Quantum Well Intermixing (QMI) technique, has announced that it has received an additional £750,000 (US$1.18m) investment from Italian based Alice Ventures. The addition of Alice's investment closes Intense's series B funding round. The additional funding takes the round led by Cazenove Private Equity previously announced on August 22nd 2002 to £11.25m (US$17.6m). For those tracking who's investing in what... and how much... Alice Ventures joins the syndicate consisting of Cazenove Private Equity, FNI Venture Capital, TTP Ventures together with first round investors 3i and ACT Venture Capital. Intense Photonics will use the funds to further accelerate the development of its product range and strengthen its marketing effort. To date, Intense Photonics has successfully secured funding totaling £21.25m (US$33.6m). Commenting on the additional funding David Lockwood, CEO of Intense Photonics said "Alice Ventures adds a further European dimension to Intense and brings a new network of contacts that complements those already provided by our existing investor base. This latest investment is also a further endorsement of the company in a period of unprecedented turmoil in the sector".

Seiko's Into VCSELs and Aixtron Gets Hold of 8" Freiberger GaAs Substrates

October 23, 2002...Add Sieko Epson Corporation to your list of VCSEL players and put Freiburger on your list of the first company to make their 8" R&D wafers ready for high end MOCVD platforms. According to MOCVD equipment supplier, Aixtron, which recently announced the startup of an AIX 2400 with an 8x3" configuration at Seiko Epson, the platform will be used for the production of GaInAsN materials. Aixtron is also the source for an update on 8" starting GaAs wafers, which are not likely to be seen coming online for another few years, since 6" material is just now getting truly suitable for volume manufacturing. We first heard of Freiberger's efforts back in August of 2000 when they presented their original announcement at ACCGE-12 that, under an R&D product funded by the German government, Freiberger first presented their VGF-grown 8" material. Aixtron AG is also a German-based company. Thanks to another recent Aixtron announcement, we now know that Freiberger is obviously progressing well enough with their 200mm (8") VGF GaAs that Aixtron is joining the other major MOCVD equipment supplier, Emcore, in tailoring their high end machines for 8" wafers when and if the market wants them. Emcore has had 8" capability for some time, but there remain major issues to overcome before they'll become a popular commodity. Those questions revolve around fragility and wafer weight/thickness, similar to what 6" had to go through before people were first willing to invest in 6" lines. Since virtually nobody is setting up new GaAs fabs, the 8" market appears about 2 years out. Other substrate suppliers rumored to be perfecting 8" GaAs are Hitachi and Sumitomo. When it comes to larger diameter substrates, the claim by Aixtron recently that they have installed several tools for SiGe growth is perhaps the more interesting news out of Germany because many compound semi players are genuinely interested in the here and now realities behind just how much of the GaAs market will be taken over by SiGe, over and above SiGe's unique application slots. If you have progress or news to share on any of these interesting compound semi fronts, drop us a line.

Sandia Expands New Materials Focus Into Biology

October 23, 2002...Sandia National Laboratories in Albuquerque, New Mexico, which has many departments involved in novel compound semi materials and component development, has announced that it is expanding its work in biotechnology into areas such as areas such as the creation of new materials. "The same way computers dominated the past 20 years, biology is going to dominate this new century like nothing else will. How can Sandia not go into biology?" said Bill Camp, Sandia National Laboratories Director of Computers, Computation, Information & Math Center. Sandia defines biotechnology as "the coming together of traditional inorganic sciences of physics, engineering and chemistry with biology" underscoring that the biotech field is making new and complex types of research possible. Included are topics of interest to the compound semi community, namely: sensors, computing, nanoscience, robotics and materials science, all of which Sandia notes are benefiting from the influx of biotech into their worlds, just as the biological sciences are advancing from the new interfaces with the physical and engineering sciences. The focus at Sandia, a Department of Energy national laboratory, on biotech started about three years ago when Al Romig, Sandia Vice President for Science & Technology and Partnerships, and Mim John, Vice President for the California Laboratory, began advocating that Sandia expand research efforts in the new field. They felt that Sandia could have an even a greater impact on keeping the United States safe by adding biology to the science and technology base at Sandia for nuclear weapons and other purposes. This fiscal year about $21 million of Sandia's $1.7 billion annual budget is devoted to biotech projects. For those interested in working with Sandia on their new biotech initiative, we refer you to their website section listing the various programs involved, which are full of Sandia's traditional colorful details and great storylines.

Toshiba Shows Where DVD Is Headed

October 23, 2002...For those tailoring blue spectrum laser diodes into next generation DVDs, Toshiba Corporation offers input of how those end systems will be configured by announcing that it will soon launch what they're calling "the world's first DVD recorder that has the ability to connect to the Internet." Slated to be out and on the holiday shopping market by mid-December, and dubbed the RD-XS40 the innovative recorder will feature a built-in hard drive with an industry-high 120GB of storage, which amounts to a capability of recording around 156 hours of movies. Whether that capability is dependent on our industry's wide bandgap technology or not, Toshiba is targeting the RD-XS40 at families that maintain what's termed "always-on" broadband connection to the Internet. What the DVD-RAM recorder has is an LAN terminal (which could also be powered by the compounds) that enables it to be connected to the broadband modem in the given household. And since that DVD recorder is "always online," users can set the device to record programs from anywhere using a PC or Internet-capable cellular phone (and we all know cellphones are full of compounds semi devices). Bottom line... the RD-XS40 is slated to retail for around 150,000 yen and Toshiba is targeting sales at 10,000 units per month. In case they end up only available in Japan (which is traditionally the case with these type first rollout products), those outside Japan might want to consider getting holiday orders in to your Japanese colleagues and conduits early.

GCS's InGaP Process Has High Breakdown Voltage

October 23, 2002...Global Communication Semiconductors (GCS) which expands its compound semi foundry offerings frequently, has announced that it can now offer customers a proprietary High Breakdown Voltage InGaP HBT foundry process tailored to address demanding wireless infrastructure needs such as base stations. “With our High Breakdown Voltage process we can address the stringent requirements of infrastructure applications in terms of both performance and reliability. Until now the only other choice was pHEMT and GCS’ proprietary High Breakdown Voltage InGaP HBT process allows for a more compact IC, higher yield and a superior combination of power and linearity. These are significant achievements considering the stringent requirements,” commented Dr. Sam Lee, GCS' new Chief Executive Officer. GCS is based in Torrance, California USA, an ISO 9002 certified company, provides compound semiconductor foundry services to the wireless telecommunication and high-speed networking industries. GCS currently offers foundry service for both InGaP and InP HBT processes and provides optoelectronic foundry services for PIN diodes used in the fiber optic communication market. More details are in GCS' news release

Inphi Offers High Speed Market Two MSA Compliment Mod Drivers

October 23, 2002...Inphi Corporation, a relative newcomer to the InP high speed IC scene (founded in November 2000 and based in Westlake Village, California USA), has introduced two new MSA-compliant modulator drivers for the high end SONET OC-192 and SDH STM-64 fiberoptic network systems markets. These ICs are added to Inphi's 10-43 Gbps driver family geared to provide OEMs with a wide array of high-speed, low-power options from a single component supplier. The new components are capable of driving a variety of differential Mach-Zehnder modulators. Specifically, the 1311DZ and 2011DZ provide network equipment manufacturers with a robust, cost-effective solution for metro, long haul, and ultra-long haul telecommunications markets and for broadband instrumentation and automated test equipment (ATE) applications. The 1311DZ supports non-return-to-zero (NRZ) data rates up to 12.5 gigabits per second (Gbps), while the 2011DZ supports NRZ data rates up to 20 Gbps or return-to-zero (RZ) data rates up to 12.5 Gbps for maximum versatility. Inphi reports that both devices exhibit superior edge rates and excellent eye quality, low jitter (less than 0.5 picoseconds rms) and fast rise and fall times (less than 18 picoseconds) as a means of helping ensure high-quality signal output. Power consumption is also held to a minimum, with each device dissipating less than 1.9 watts at an output level of 6 volts differential peak to peak.

Intelligent Sensors Get Squirrly

October 20, 2002...Since there never seems to be enough news about advanced sensors, we though readers supporting that sector would enjoy reading a recent Forbes Magazine article titled: Sensors Gone Wild authored brilliantly by Benjamin Fulford. It seems an advanced motion sensor outdoor experiment in the California desert proved that squirrels eat quite a lot of moss, which humans evidently didn't realize prior to the proof. But what we liked best in the article was the point made that this finding was an amusing side of an ambitious $40 million experiment which had the goal of exploring the uses of intelligent sensors, a technology our CompoundSemi News editorial staff has tracked for many years. When Forbes finally covers one of our favorite topics, it must finally be getting real. Here a taste of the article to whet your appetite to read the whole thing. It's the language that makes it interesting: "Eventually large swaths of the Earth will communicate with the digital realm using millions of miniature sensors. 'We will really be able to instrument the physical world,' says Deborah Estrin, a UCLA computer science professor who runs the Center for Embedded Networked Sensing, which oversees the James Reserve project. Sensors will be placed in bridges to detect and warn of structural weakness, and in water reservoirs to spot hazardous materials. Hospitals will track patients with such things as wireless bandages that warn of infection. Truck drivers will be able to dodge traffic jams based on slow-ups twenty cars ahead. Urban planners will track groundwater patterns and how much carbon dioxide cities are expelling, letting them make better land-use decisions. Farmers will be able to apply fertilizer and water only to the exact bits of the field that need them." Give it a read... it just gets better.

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The McDonald Report
Commentary & Perspective...

Snapback Expected from TriQuint's Acquisition of Agere's Opto Business

Cree and Highlink Provide Bellweather News

If you have questions about the solid state lighting and compound semiconductor industries or have news or views to share, I'm Jo Ann McDonald, Editor of LIGHTimes and CompoundSemi News.
Feel free to contact me directly, anytime.
My direct tel at the ranch is
+1-325-463-5345

From time to time Jo Ann may comment on companies in which she holds a modest investment - be sure to read her disclosure at some point in time...