IDM model gets bad rap, says 'fab club' exec

Mark LaPedus, EE Times
(05/04/2006 7:04 PM EDT)
 
CUPERTINO, Calif. — Integrated device manufacturers (IDMs) are getting a bad rap in the market, especially from short-sighted Wall Street analysts who lack a thorough understanding of the concept of wafer fabs, according to the executive from the “fab club.”

The concept of building and owning a wafer fab for many IDMs these days has taken on a "negative connotation" in the market, said L.T. Guttadauro, executive director of the Fab Owners Association (FOA, Cuperino, Calif.), a group that represents IDMs.

"I’m concerned," Guttadauro said. “The fab model has taken a beating. Fabs are a valued and strategic part of a company."

Intel, Samsung, TI and a handful of other leading-edge IDMs have been able to justify their massive fab investments in the market. Fabs are also critical for small- to mid-size IDMs, many of which develop specialized processes that are difficult to outsource, according to the FOA executive.