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Editorial: CS/SSL Stock Portfolio Up an Impressive 60%
 
... As of February 1st when last Jo Ann reported on her model portfolio of compound semi (CS) and solid state lighting (SSL) industry stocks, the value of the portfolio had increased an impressive 43%. As of March 20th, that value figure has risen even further to 60%... a figure...
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Kyma Signs Cooperative Agreement With NRL
CompoundSemi News Staff

March 27, 2006...Kyma Technologies, headquartered in Raleigh, North Carolina USA, has signed an agreement with the US Naval Research Laboratory to research and develop gallium nitride (GaN) field effect transistor (FET) technology. The goal of the cooperative research and development agreement (CRADA) with the U.S. Naval Research Laboratory (NRL) is to advance GaN FET technology for high-speed, high-power electronics technologies. According to Kyma, the CRADA will specifically investigate the potential for low defect density native GaN substrates to enable improvements in the performance and reliability of high power radio-frequency (RF) transistors based both on conventional GaN field effect transistor (FET) designs and on novel FET designs. Kyma hopes that the research and development effort will benefit from recently announced improvements in their semi-insulating (SI) GaN product line.

The NRL program managers for the CRADA are Dr. Steve Binari and Dr. David Storm. Kyma’s co-founder Dr. Drew Hanser will serve as the technical lead for Kyma. NRL’s Dr. Binari reportedly presented results of the Kyma-NRL collaboration including X-band GaN FET results at the recent Workshop on Compound Semiconductor Materials and Devices (WOCSEMMAD) held earlier this year in Scottsdale, Arizona.“Our existing collaboration with NRL has produced encouraging early materials and device results, showing excellent epitaxial growth and very good device performance up into the X-band,” Dr Hanser said. “We look forward to working closely with the NRL team to develop FETs that have both the performance and the reliability required for use in advanced military systems.” Company News Release

Veeco Introduces Two Scanning Probe Microscope Products
CompoundSemi News Staff

March 27, 2006...Veeco has introduced two new scanning probe microscope products. The Multimode V SPM and the Dimension V SPM. Both feature the company’s Nanoscope controller which the company says enables researchers to see faster molecular scale events, capture more information in every image and work with "one-button" simplicity. The MultiMode SPM is the world's best-selling SPM. It performs the full range of AFM and STM (scanning tunneling microscopy) techniques to measure surface characteristics like topography, elasticity, friction, adhesion, and magnetic/electrical fields. The Dimension V is ideal for micro- and nanoscale studies and applied materials research; industrial product development and quality control; and critical feature metrology, failure analysis, and electrical characterization. Company News Release

Optellent Introduces OptoBERT for Less Expensive BERT

March 27, 2006...Test and measurement company, Optellent of San Jose, California USA has introduced what they say is the optimal approach to bit error rate detection (BER) testing in a compact and cost-efficient product dubbed, OptoBERT. President and CEO, Vinod Ramakrishnan stated, "The OptoBERT is ideal for many organizations for which a full-featured BERT is simply overkill. This unit provides ease of use, compactness, portability, and automated data archiving and, perhaps of paramount importance to many users, it provides a savings of 70-80% over conventional BERTs.” Company News Release

DOE to Fund SSL and Compound Semi Research
LIGHTimes Staff

March 22, 2006...The United States Department of Energy (DOE) has announced the solid state lighting development projects selected to receive support from the National Energy Technology Laboratory (NETL). The NETL selected 16 applications for solid state lighting core technology development. The University of California, Santa Barbara, Rensselaer Polytechnic Institute, Georgia Tech University, and Purdue University are among the Institutions to be given funding for their research. Sandia National Laboratories was selected in the lab call for three LED related projects. The goal of the NETL-supported research is to develop technologies that support an overall efficiency of 50 percent by 2025. LIGHTimes Secondpage members can read the extended version...

 

SatCon Reports Contract Win and Purchase Order
CompoundSemi News Staff

March 23, 2006...Power electronics company, SatCon of Boston, Massachusetts USA, received a purchase order from Azure Dynamics Corporation for the production of 50 systems for use on hybrid electric vehicles, in a delivery fleet application. According to SatCon, the ordered products include: a brushless DC motor (rated at 250 - 350 VDC input, 3 Hp), motor controller, and a DC/DC power converter (rated to 120 Amps continuous) which lowers the DC bus voltage from 350 VDC (nominal) to 12 - 14 VDC to power conventional automotive electrical components and systems. SatCon News Release.

SatCon also announced Wednesday receiving a follow-on purchase for its StarSine Rotary Uninterruptible Power Supply (RUPS) from the National Institute of Technology and Standards. According to SatCon, the contract to provide a turnkey solution including design, delivery, and installation came from a GSA federal supply schedule through Baldwin Technologies Inc. The device is connected directly to SatCon's patented flywheel for short duration power disturbances and is integrated with a diesel engine to provide a seamless transfer and long-term power in the case of an extended outage. SatCon News Release

Kyma Introduces Commercial Bulk GaN
CompoundSemi News Staff

March 21, 2006...Kyma Technologies announced the availability of improved semi-insulating (SI) GaN substrates and the addition of a new product line based on non-polar and semi-polar GaN substrates. Earlier in the month of March, the company received additional backing from the United States Department of Defense (DOD) Missile Defense Agency (MDA). In addition to being critical for military radar, native GaN might be used for commercial applications including: power switching electronics, high-power radio-frequency electronics, solid state lighting, optical storage (blue lasers), bioagent and chemical sensing, and ultraviolet detection. (Ref: Coverage)

According to Dr. Ed Preble, Kyma’s vice president of engineering, Kyma has optimized its SI GaN boule growth process to effectively eliminate the conductive regions which can limit the resistivity uniformity of SI GaN substrates. Dr. Preble commented, “Based on several different sets of electrical characterization data from our collaboration partners, we realized we needed to eliminate the effects of certain conductive defects. We believe our new SI GaN products will enable our customers to attain better high frequency transistor performance and to benefit from better electrical isolation between adjacent devices.” Company News Release

Integrated Materials Launches SiFusion Poly Silicon Furnaceware

March 23, 2006...Integrated Materials Inc. of Sunnyvale, California USA, has launched its furnaceware called SiFusion which they say demonstrates performance superior to quartz and silicon carbide. Additionally the company touts the device’s ability to reduce defect density and increases furnace throughput. According to the company, the suite of SiFusion furnaceware includes furnace boats, towers, injectors and pedestals designed to fit furnaces manufactured by ASM, Aviza, Hitachi-Kokusai and Tokyo Electron. Company News Release

Sony Debuts Blu-ray Player, Recorder, and PC
CompoundSemi News Staff

March 21, 2006...Sony has debuted its first Blu-ray Disc (BD) products including a home player, Vaio desktop and Laptops, an internal computer drive sold separately, and recordable/writable media, according to an article on CNET. Among the newly released products are the BDP-S1 Blu-ray Disc player and the Vaio RC desktop computer. The suggested retail price for the player is about $1000. The Vaio PC with Blu-ray drive should cost about $2300 and will be available by early summer.

In April, Sony plans to begin shipping 25GB BD-R (write once) and BD-RE (rewritable) discs for about $20 and $25 respectively. The 50GB BD-R and BD-RE dual-layer discs will come in subsequent months for about $48 and $60 respectively. According to a separate article on CNET, Sony’s Blu-ray disc recorder will be priced at around $3800 for its Japanese release in April.

In February, the nine companies promoting Blu-ray Disc technology (Hitachi, LG Electronics, Matsushita Electric Industrial, Pioneer, Royal Philips Electronics, Samsung Electronics, Sharp, Sony and Thomson) announced the start of licensing, the article indicated.

Aviza Gets Multiple System Order From SMIC

March 20, 2006...Aviza Technology Inc. has received an order for multiple LPCVD systems from SMIC. Aviza Technology Inc. of Scotts Valley, California USA, a semiconductor equipment maker announced receiving orders for multiple low pressure chemical vapor disposition machines from Semiconductor Manufacturing International Corporation of Bejing. The systems ordered include the RVP-300plus and the RVP-550 thermal processing systems. According to Aviza, the tools will be shipped to SMIC’s Bejing Fab 4 facility. Aviza contends that the SMIC has the only Chinese owned 300mm fabrication facility in Beijing. Aviza indicated that SMIC will utilize the LPCVD devices for DRAM production. Aviza News Release

Comlent and Agilent Team Up for SCDMA Reference Lab in China
CompoundSemi News Staff

March 20, 2006...Comlent Technology Inc., a fabless radio frequency integrated circuit (RFIC) design house of Shanghai, China, and Agilent Technologies are teaming up to establish the “Comlent-Agilent TD-SCDMA Reference Lab (China).” According to Agilent, the lab is oriented for R&D, test, and validation of RFIC, RF module and mobile terminal performance. The lab will focus on following TD-SCDMA, the third 3G international standard favored by China in addition to WCDMA and CDMA2000 mostly deployed in Europe and the United States respectively. Both companies hope the lab will help to accelerate the development and maturity of RF technology for China’s TD-SCDMA chain. Comlent News Release

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Commentary & Perspective...

CS/SSL Stock Portfolio Up an Impressive 60%

March 20, 2006...As of February 1st when last Jo Ann reported on her model portfolio of compound semi (CS) and solid state lighting (SSL) industry stocks, the value of the portfolio had increased an impressive 43%. As of March 20th, that value figure has risen even further to 60%... a figure that any USA stock market follower would say is "huge and exciting news." To follow are the details of how the portfolio is performing.

When I first dived into this "model stock portfolio" experiment, my primary motivation was not profit... although that would be a nice bonus. The motivation was to prove to myself, colleagues, and friends that we'd truly hit bottom and that there was really no way to go but up. To do so, I needed to provide myself with some kind of tangible metric to track the awkward upward climb back into semiconductor industry prominence. I never expected that the overall progress of the portfolio would be regarded as "huge and exciting news," but that's what my broker says it is. And I believe him.

The challenge now is to leverage that "news" in some way... beyond these niche pages. If you represent any of the companies in the portfolio, give some thought as to how we might do that, collectively or individually. In order of their purchase (a process that began last May), the 13 companies included in the model portfolio and their Nasdaq trading symbols are: Emcore (EMKR), Cree (CREE), TriQuint (TQNT), Color Kinetics (CLRK), Anadigics (ANAD), JDS Uniphase (JDSU), Spire (SPIR), RF Micro Devices (RFMD), Kopin (KOPN), WJ Communications (WJCI), Vitesse (VTSS), Aixtron (AIXG), and AXT (AXTI).

As adequately pre-announced in these pages to satisfy any SEC concerns, I purchased 100 shares of each at what I felt was their rock bottom low. The selection was not based on just bargain-basement pricing. These were companies I knew, from experience, would be around for many years to come. I also respect these companies and their management for their past performance and have faith they'll continue to provide the kind of shareholder and customer value that indeed models the CS and SSL industries.

The purchase of Emcore stock was the easiest, not only because it was trading at only $3.63/share, but because I know Emcore better than any other company in our field. I consulted for Emcore for three years in the 1990s during both the telecom boom and early rollout of the SSL and multijunction solar cell industries. Taking a sabbatical from journalism to be their director of corporate communications proved to be a job that taught me more about the CS and SSL industries than any editor could ever imagine. The purchase of Cree and Color Kinetics's stocks were the most difficult decisions simply because both were already trading in double digits back in May of 2005. I'm not only a natural tightwad, I didn't have that much to "gamble" on this experiment. But who could resist Cree and CK? They were both born winners, and I've known both since their respective births.

The EMKR, CREE, and CLRK stocks have turned out to be the best performers in the portfolio. As of March 20th and this writing, Emcore has provided an "unrealized gain" of $870, Cree has added $770, and Color Kinetics has turned in a $669 gain. The total cost of the entire portfolio was $6,908 and today it's worth $10,038. That's an overall "unrealized gain" ("unrealized"... because not only is that the terminology required, but there's literally no way I'd cash these babies in now!) of $4,167.35. Take the gain and divide it by the cost, and you get the 60% increase in value.

Looking over the score sheet since their respective purchases, my EMKR stock has enjoyed a steady rise. Cree has had a bit of a mini-roller coaster ride and TQNT is finally enjoying a mild overall rise. CLRK has steadily risen, and ANAD is finally enjoying a nice steady rise, as has JDSU. SPIR is still riding their dramatic upswing from last summer. RFMD is steadily rising, and the only minus comes from KOPN which lost me a whole $7.95.

The final four in the portfolio, which were added later as their prices sank to irresistibly low buy-in levels, are probably the best indicators of how the overall CS-related (or rooted) industry really is recovering. At first, WJCI and VTSS's stock prices fell even further after I purchased them, but they're now both on the rise again. WJCI turned in a tidy $51 overall gain and VTSS $93 as of today. The final two, AIXG and AXTI, were the latest purchases when Aixtron's stock was $3.42/share. Despite recent news that Aixtron's has had to streamline operations, their branching out to the organic and innovative silicon industries is evidently viewed as sensible because their stock is trading today at $4.31. AXT underwent a major overhaul under the Phil Yin (formerly of Aixtron) and has managed to pull their stock up from $1.25/share (when I purchased it) to $3.42/share today. That's already netted me a tidy $212.05 gain. Kudos to both AIXG and AXTI's management teams for the turnaround.

What I read into the overall performance of my model portfolio is that things are indeed looking up. Finally. the biggest winners, in order of overall stock performance, are: Emcore, Cree, Color Kinetics, Anadigics, and Spire, who have collectively provided gains in the range of $870 to $421. They're followed by JDS Uniphase, RFMD, and AXT weighing in at the +$200 range. The rest of my baker's dozen (aka my "Lucky 13") contributed only single or double digits, except for Kopin, the only minus in the batch. But knowing KOPN, it'll be back up soon.

The overall performance of the portfolio says a lot for the management strategies of the three big winners and the perseverance of the other ten. For those struggling for prominence in their respective fields, take a close look at what Emcore, Cree, and CK have been doing over the past year. These three companies continue to pioneer the CS and SSL industries. These three are the best models I could point to as how to succeed in very tough businesses.

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