Word: rams
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...ever since primitive semiconductors were first mass-produced in the 1950s. Now that supremacy is being threatened by a formidable and frightening competitor: Japan. Last year Japanese companies, led by Hitachi, Fujitsu and Nippon Electric, captured 70% of the world market for a new, advanced chip called the 64K RAM (for random access memory) that is expected to become the biggest-selling semiconductor product by 1985. This chip can store 65,536 separate bits of data, or four times the capacity of the 16K RAM, which until recently was the industry standard. For U.S. chipmakers, who have watched the Japanese...
...stakes in the chip competition are staggering. Worldwide sales of semiconductors are expected to surge from $14 billion last year to $27 billion in 1985, including $2 billion for the 64K RAM alone. "Almost everything is going to have chips, even your lawnmower," says Harald...
...reason the Japanese took the lead in the market for the newest generation of memory chips was their price cutting in the early competition. In 1981 Japanese firms dropped the cost of a 64K RAM from about $23 to as low as $5, and it has stayed at roughly the same level this year. Though major American electronics companies like Motorola can afford to match that kind of price, the smaller, more specialized Silicon Valley firms like Intel and National Semiconductor are more hard-pressed to stay competitive...
...long after that, Japanese shipments of the 64K RAM to the U.S. slowed down a bit, and the price of their chips stopped falling. The Japanese firms said they were limiting their exports because of strong demand for chips in their domestic market. Some industry analysts in the U.S., however, suspected that the Japanese were reducing their shipments to avoid facing U.S. import restrictions...
...semiconductor contest could be affected by two giant American companies that have never sold a chip: IBM and the Western Electric unit of AT&T. They make millions of chips, but use them internally to build such finished products as computers and telephone switching equipment. IBM produces more 64K RAM chips than all the world's semiconductor firms combined. The company's manufacturing process for the 64K achieves a phenomenal 60% yield of perfect chips, compared with a maximum of 50% claimed by the Japanese...