Japan's largest computer maker Fujitsu Ltd and electric cable maker Sumitomo Electric Industries Ltd said Thursday they would form a joint venture to produce compound semiconductors next spring.
Demand for compound semiconductors -- integrated circuit (IC) chips made of such materials as gallium arsenide instead of silicon -- is expected to boom due to their use in mobile phones, DVD players and other home appliances, the companies said in a statement.
"The market for wireless, broadband, communications and information terminals that use these chips is expected to grow in the future," said Fujitsu spokesman Hiroyasu Katagiri.
The 50-50 joint firm capitalized at ¥20 billion (US$187 million) will start operations April 1 and projects annual sales of ¥60 billion by March 2007, he said.
The global market for compound chips is expected to leap from ¥300 billion to ¥500 billion in the year to March 2007, the Asahi Shimbun said.
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