Ba401 Intel Corporation


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Ba401 Intel Corporation

  1. 1. Intel Corporation:The DRAM Decision<br />
  2. 2. Introduction<br />
  3. 3. Introduction<br />Since 1980,Intel had been losing its market position in dynamic random-access memories (DRAM) as the industry average selling price per chip had declined much more rapidly than the 20-30% / year which was customary.<br />
  4. 4. Introduction<br />The Japanese had taken the lead in unit sales of the latest generation of DRAMs, the 256 kilobit(256K) version, but Intel was fighting back with next generation .It’s $50 million1 megabit.<br />
  5. 5. Introduction<br />Still,a debate was growing within the company about whether Intel could continue to compete in the market of DRAMs.<br />The memory businesses had made Intel,and was still by far the largest market segment in integrated circuits.<br />
  6. 6. Company Background<br />
  7. 7. Company Background<br />Andy Grove,Bob Noyce and Gordon Moore<br />1969 Intel introduced first product ,a bipolar static random-access memory (SRAM) with 64-bit.<br />
  8. 8. Company Background<br />Themetal-oxide-semiconductor (MOS) process promised to lead to increased transistor density.<br />MOS SRAM first commercially available,the 256-bit “1101”.<br />
  9. 9. Development of DRAM<br />
  10. 10. Development of DRAM<br />The first DRAM in 1970, the 1-kilobit “1103”.<br />While the SRAM required six MOS transistors per <br /> memory cell, the DRAM required only 3 transistors.<br /> With fewer elements in each memory cell, the 1103 <br /> contained more storage capacity in the same silicon<br /> area.<br />
  11. 11. New DRAM Generations<br />
  12. 12. New DRAM Generation<br />In 1972 DRAM (1103)converted the process from 2-inch to 3-inch. <br />Competitors entered the market for DRAM and began to erode Intel’s MOS process technology lead.<br />
  13. 13. New DRAM Generation<br />The first DRAMs were not very user-friendly, and MOSTEK came out with a better product.<br />DRAM-4K was redesigned to include the internal Multiplexing logic.<br />
  14. 14. New DRAM Generation<br />DRAM 16K “2116” and “2117”<br />In 1979 Intel introduced 5-volt-single-power-supply 16K DRAM “2118” ,greatly –simplified the user’s design and production tasks.<br />Intel’s competitor focus on DRAM 64K.<br />
  15. 15. The Invention of the EPROM<br />
  16. 16. The Invention of the EPROM<br />The EPROM (electrically programmable read-only memory) was invented by Dov Frohman.<br />It could be applied to a memory device, designed the first part,and fabricated the first device.<br />
  17. 17. The Invention of the EPROM<br />Frohman was assigned to help understand a strange phenomenon which was causing reliability problems with the MOS process. <br />The problem with the<br /> MOS process involved <br /> the silicon gate structure.<br />
  18. 18. The Invention of the EPROM<br /> Frohman saw that the phenomenon could be explained by the existence of an unintentional floating gate within the MOS device.<br />
  19. 19. The Invention of the Microprocessor<br />
  20. 20. The Invention of the Microprocessor<br />Ted Hoff invented the Microprocessor<br />Intel had been hired by the Japanese firm Busicom to design and build <br /> a set of chips for a number of <br /> different calculators.<br />
  21. 21. The Invention of the Microprocessor<br />Hoff was the architect of the chip set which Federico Faggin and a team of designers implemented. The set included four chips: <br /> 1.A central processing unit (CPU) called the 4004.<br />
  22. 22. The Invention of the Microprocessor<br />2.A read-only memory (ROM) with <br />custom instructions for <br />calculator operation.<br />3.A random-access memory (RAM).<br />4.A shift register for input/output buffering<br />
  23. 23. The Invention of the Microprocessor<br />Early 1970,Intel signed a $60,000 contract which gave Busicomproprietary rights to design.The CPU chip,4004, was eventually called a Microprocessor.<br />While Intel produced chips for Busicom which were successfully made into 100,000 calculators.<br />
  24. 24. The Invention of the Microprocessor<br />4004 – The 4004 was introduced in 1971.<br />It contained 2,300 MOS transistors <br /> and could execute 60,000 <br /> instructions per second.<br />
  25. 25. The Invention of the Microprocessor<br />8008- Intel developed 8-bit microprocessor which was introduced in 1972.<br />It was too slow and required 20 support chips for operation.<br />
  26. 26. The Invention of the Microprocessor<br />8080- Intel had created an NMOS could execute 290,000 instructions per second,in addition, the 8080 required only six support chips for operation.<br />Intel was one year ahead of Motorola’s <br /> introduction or the 6800 and <br /> eventually took nearly the entire<br /> 8-bit market.<br />
  27. 27. The Invention of the Microprocessor<br />Intel’s 16-bit ,the 8086, again was first to market by about one year when it was introduced in 1978.<br />Motorola introduced its own 16-bit ,<br /> the 68000,and appeared <br /> to be gaining momentum <br /> in the field.<br />
  28. 28. The Invention of the Microprocessor<br /> Intel created a task force to attack the<br /> 68000.The project was called operation <br /> CRUSH.<br /> The CRUSH campaign emphasized Intel<br /> the most notable win was IBM’s decision <br /> to use the 8088 in their first PC.<br />
  29. 29. The Invention of the Microprocessor<br /> The 80186 and 80286 were designed <br /> to increased integration, internal <br /> memory management ,and advanced <br /> software protection capability.<br /> Motorola- project CHECKMATE paralleled <br /> the earlier project CHUSH in concept.<br />
  30. 30. Synergies Between EPROMs and Microprocessor<br />
  31. 31. Synergies Between EPROMs and Microprocessor<br />EPROM better thanROM<br />- develop and reviseprogram. <br /> - could not effort the expense of a custom <br /> ROM could substitute off-the-shelf <br /> EPROMS.<br />
  32. 32. Synergies Between EPROMs and Microprocessor<br />Intel had a competitive advantage in the EPROM <br /> - EPROM’s Intel had floating gate process. <br /> - Packaging, testing and reliability engineering.<br />
  33. 33. Synergies Between EPROMs and Microprocessor<br />In1977 Intel introduced the 16K EPROM,2716,which was compatible<br /> with any microprocessor system.<br />In 1981 the EPROM market was challenged by several competitor.<br />
  34. 34. Synergies Between EPROMs and Microprocessor<br /> Intel 64K EPROM“2764” met <br /> very aggressive yield goals <br /> and was again leading the <br /> world in EPROM.<br />
  35. 35. Technology Development<br />
  36. 36. Technology Development<br />3 groups of Intel Technology Development<br /> - DRAM<br /> - EPROM<br /> - Logic/SRAM<br />
  37. 37. Technology Development Groups<br />
  38. 38. Technology Development<br />The memory technology development group represented Intel’s best corporate resource for process development.<br />There is more of a connection between the designer and the process engineer.<br />
  39. 39. Intel Product Line and Situation in Late 1984<br />
  40. 40. Intel Product Line and Situation in Late 1984<br />By the end of 1984, logic product were the dominant source of Intel’s revenue.<br />The 80186 and 80286 were tremendously successful.<br />IBM PC purchased microprocessors either from Intel .<br />
  41. 41. Intel Product Line and Situation in Late 1984<br />The only serious 16-bit architectural <br /> competitor was Motorola.<br />Intel had developed a microcontroller <br /> which integrated logic and memory to <br /> provide one-chip computer which <br /> were used to control everything<br /> from house fans to complex satellites.<br />
  42. 42. Intel Product Line and Situation in Late 1984<br />Late 1985 was the successor to the 80268, the 32-bit 80386 microprocessor.<br />Motorola had developed a strong 32-bit product, the 68020,and was <br /> already in the marketplace <br /> winning designs.<br />
  43. 43. Intel Product Line and Situation in Late 1984<br />The 80386 was scheduled to be one of the <br /> first product made with the new <br /> complementary MOS (CMOS) process.<br />
  44. 44. Intel Product Line and Situation in Late 1984<br />In 1984, the Livermore group was developing two distinct processes for SRAM and microprocessor.<br />The high-volume SRAM segment demanded a new four-transistor cell design and process. By contrast, the high-speed SRAM and the new 80386 microprocessor both demand six-transistor CMOS design.<br />
  45. 45. Intel Product Line and Situation in Late 1984<br />The high-volume SRAM process required a complex polysilicon resistortechnology.<br />Eventually,they decided to drop the polysilicon resistor process and go with six-transitor (focus on 386).<br />
  46. 46. Intel Product Line and Situation in Late 1984<br />Development the 386 with a double<br /> metalization process while as the same <br /> time to reducing line widths to 1.5µm <br /> (from 2µm) and implementing the CMOS process. <br />
  47. 47. Intel Product Line and Situation in Late 1984<br />Market and technology development which may have contributed to the loss of a competitive SRAM product.<br /><ul><li>SRAM received less attention for high-quality designer.
  48. 48. They had a strong position in high-speed SRAM but they give it up without really making a conscious decision.</li></li></ul><li>Intel Product Line and Situation in Late 1984<br />The end of 1984 represented the same <br /> 30% of revenue that MSO had represented <br /> in 1973.<br /> While a great deal of system business <br /> comprised development products aimed at <br /> microprocessor and microcontroller users.<br />
  49. 49. Manufacturing and Process Fungibility<br />
  50. 50. Manufacturing and Process Fungibility<br />Intel took great pain to standartlize each facility as it expanded its manufacturing base<br />Each Intel chip would <br /> “look and taste” the same <br /> no matter which facility produced it<br />
  51. 51. Manufacturing and Process Fungibility<br />As larger-diameter silicon wafers became available,Intel developed a process on one line and then transferred the technology to its other facility.<br />By 1984,Intel had seven fab in the united States.Due to more stringent manufacturing standard, the cost of a fab area had risen dramatically since the 1970s.<br />
  52. 52. Manufacturing and Process Fungibility<br />Around the time they were deciding to put up a fab in Israel or Japan<br /> - Israelhad tremendous government subsidies and good labor market.<br /> - Japan have a tapped the expertise <br /> of Japanese DRAM technology<br /> development,silicon maker and <br /> the infrastructure support.<br />
  53. 53. Manufacturing and Process Fungibility<br />There are three main process areas : fabrication,assembly and test. <br />Fabrication is usually the bottleneck in times of tight capacity. – the good one was allocation.<br />The finance group thought of DRAM as a “low ROI,high beta” product line.<br />
  54. 54. Environmental Forces<br />
  55. 55. Environmental Forces- Competitors -<br />1.U.S. full line digital design and supply houses<br /> - Motorola: produced DRAM,<br /> microcontroller and microprocessor<br /> - National Semiconductor<br /> - Texas Instrument :microprocessor<br />
  56. 56. Environmental Forces- Competitors -<br />2. AMD<br />3. Japan-Hitachi, Fujitsu, NEC, Toshiba<br /> - DRAM SRAM and EPROM. Served second source to U.S. microprocessormicrocontroller suppliers<br />
  57. 57. DRAM Situation in 1984Loss of Leadership Position<br />
  58. 58. DRAM Situation in 1984Loss of Leadership Position<br />By the end of 1984,Intel had lost significant market share in DRAM.The first real difficulties had come with the 64K generation.<br />Ron Whittier said that 64K version,<br /> the memory cell size was reduced,<br /> but the actual die size still had to be increased significantly.<br />
  59. 59. DRAM Situation in 1984Loss of Leadership Position<br />The DRAM group calculated that the <br /> required die size would be too big.The 64K<br /> DRAM would be too slow to be acceptable,<br /> In order to boost yield,the group decided to <br /> build in redundancy at the chip level.<br />
  60. 60. DRAM Situation in 1984Loss of Leadership Position<br />Redundancy – Intel added an extra column of memory elements so that in the event of a process-induced defect,the auxiliary column could be activated.There was a physical switch, or “fuse” built into each column which could be address by the tester machinery.<br />
  61. 61. DRAM Situation in 1984Loss of Leadership Position<br />TI ,engineers had concluded redundancy would not be economical and <br /> had deferred the discussion <br /> until the next generation.<br />
  62. 62. Attempts to Regain Leadership Position<br />
  63. 63. Attempts to Regain Leadership Position<br />NMOS toCMOS<br /> - CMOS circuit was more complex<br />- used in laptop<br />Intel produced CMOS 64K and 256K DRAM in a niche strategy.<br />
  64. 64. Attempts to Regain Leadership Position<br />In1983<br />Demand was in an upswing,and Intel seemed to have a techonology strategy which could lead to dominance in the1-meg DRAM.<br />
  65. 65. Attempts to Regain Leadership Position<br />In 1984<br /> CMOS DRAM price at about one and a half to two times the prevailing NMOS price.<br /> Niche strategy : differentiate the product from other offering, and sell it on features.<br />
  66. 66. Attempts to Regain Leadership Position<br />The price of NMOS DRAMs fell by 40% from<br /> May to August 1984.<br />By late 1984Intel was down to less than 4%<br />of the 256K market and had lost its position <br /> entirely in 64K DRAMs.<br />
  67. 67. Attempts to Regain Leadership Position<br />In the future<br />The 1-meg DRAMwill be a technically <br /> outstanding product, at least one and a half <br /> to two years ahead any competition.<br />A technology transfer deal should with <br /> a Korean chip manufacturer.<br />New competitor<br />
  68. 68. Option for DRAM<br />
  69. 69. Option for DRAM<br />1. drop it all together.<br />2. stay on the business as a niche player.<br />3. license the technology to another company<br />4. invest in DRAM capability at the 1-meg level and commit to a low-margin business.<br />
  70. 70. Option for DRAM<br />We have been trying to find a clever way<br /> to stay in this business without betting<br /> everything we have, but maybe there <br /> is none.<br />