Taiwan's major blue-chip technology companies aren't on the keynote speech list at the ongoing Comdex Fall tradeshow in Las Vegas. But Transmeta Corp's reported confirmation that it has entered a foundry deal with Taiwan Semiconductor Manufacturing Co (TSMC,
David Ditzel, chief executive officer of chipmaker Transmeta (
"TSMC never comments on our customers," said JH Tzeng, manager of the public relations department at TSMC.
"If Transmeta did make an agreement to use TSMC as its CPU foundry provider, that shows at least TSMC's strong capability in CPU manufacturing technology," he said.
The central processing unit is the brain of a computer and where most calculations take place.
Start-up computer chip maker Transmeta, which raised US$273 million in its initial public share sale last week, is challenging No. 1 chipmaker Intel Corp (
The chip, released in January, is designed for mobile Internet computing devices.
Ditzel said that TSMC will use its new 0.13-micron process technology to produce 800MHz and 900MHz chips for Transmeta in the second half of next year, the technology journal reported.
"It's a breakthrough for TSMC," said Andrew Teng, an analyst at Taiwan International Securities Corp (
"It proves TSMC has the ability to make not only chips, but also CPU processors," he said.
With Transmeta likely to be big in the information appliance market, TSMC should benefit financially, as well as from having such a high profile customer, Teng said.
"It's going to help TSMC in both top line and bottom line growth," he said.
Meanwhile, CMC Magnetics Corp, the second largest recordable compact disk manufacturer in the world, also announced Monday that it had received US$50 million worth of orders for its information appliance products on display at the Comdex show.
CMC shares rose 6.78 percent yesterday to NT$37.8 on trading of 43.7 million shares.
CMC, which is turning itself increasingly into a producer of information products and other opto-electronic products, said in a press release that its Cyberboy and Jumper II had attracted particular attention at the Las Vegas technology show.
Production of CMC's Cyberboy, a personal digital assistant that incorporates a number of information application devices such as MP3 player and digital camera, began in the fourth quarter, with shipments starting from the end of this month, an official at CMC said yesterday.
Shipments of Jumper II, an MP3 player, began earlier this year.
As well as increasing revenue, the order is a boost for the company as it attempts to move away from the production of CD-Rs and into more profitable products.
"Our current plan is that the ratio of revenue from IA products will rise to 30 percent to 40 percent next year," a CMC official said.
Last year the ratio was over 80 percent.
An oversupply of CD-Rs this year has caused prices to plum-met, reducing profits and forcing CD-R makers to diversify into other product lines.
Last week, CMC lowered its predicted earnings per share for the year by over 40 percent to NT$3.81.
"The order is very helpful for the company," said Richard Wu, an analyst at International Securities Co.
"The company has to diversify, so for it to receive orders at Comdex is a very good sign," he said.
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