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IBM has been successful in its own right in this space. Long known as a manufacturer of memory chips, IBM recently announced a line of 3D chipsets, made by combining high-density, high-performance layers into a coupled stack. This allows the embedded transistors to be placed closer to each other, which accelerates the process of processing. A problem that the industry has often faced with 3D arrays is the heat required in the manufacturing process to add a second layer: The heat often degraded the first layer during the bonding process. The IBM method uses a lower temperature technique to bond the multiple layers to one another. In practice, a thin glass layer is applied to the face of the second layer, after which the other side is etched. The resulting wafer is 200 millionths of a millimeter thick, and is aligned and bonded to the first wafer. Because the resulting stacked wafer is so thin, it behaves as if the circuitry actually exists in a single layer. By using this 3D method, multiple functions can be combined in less real estate, and processing speeds are dramatically improved. As optical technology has matured and become a viable alternative to electrical transport in certain circumstances, a new set of challenges have arisen. One challenge that has always faced the component industry is the ability to build optical chipsets. Electrons will live happily in two-dimensional space, moving in a very controlled fashion along a designated conductor. Photons, on the other hand, are much more difficult to control. Attempts to build waveguide technology have succeeded using etched gratings, multiple fibers, and mirrors, but these solutions are by necessity quite large a problem in a real-estate constrained industry. New research into particle physics in Europe has yielded a small packet of energy called a (ready ) surface plasmon polariton (SPP), sort of a hybrid between electrons and photons. These SPPs are formed in the region between a metal surface and a dielectric surface, commonly found (indeed, designed into) chipsets. These SPPs can be manipulated in 2D space. The result is that etched wafers can now be built that move photons but that are as small as those used for electrons that is, along the lines of traditional semiconductor designs. And while this technology is nascent, it will mature and become a part of the technological pantheon among component manufacturers.
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Component manufacturers face major challenges in the months ahead. The downturn in the greater telecommunications industry resulted in massive revenue reduction, which in turn caused a buy-down of the
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number of manufacturers in the sector, particularly among those focused on building components for the much-anticipated, never-ending optical core transport buildout. In fact, 2002 was the first year in history in which the United States failed to be the largest market for semiconductors. Nevertheless, certain applications continue to drive sales among component manufacturers. Mobile phones, for example, drive 30 percent of global component sales and China consumes 25 percent of all mobile output. Other drivers, mentioned earlier, include automotive, display technology, wireless, and nanotechnology. Another challenge is the ongoing commoditization (if that s a word) of the component industry. There are quite a few similarities between the histories of the American steel and component industries; it is worth a brief side trip.
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The steel industry has its roots in the iron industry, which started in North America as early as 1621 in Jamestown, Virginia. The industry grew over the years until the Civil War, when the shift from iron to steel took place. Steam engines made it possible to build massive factories capable of producing larger quantities of product, and over the years the industry became completely, vertically integrated. In 1901, under the management genius of such visionaries as J. Pierpont Morgan and Elbert H. Gary, the United States Steel Corporation was formed as the largest industrial corporation on the planet. At that time its capitalization was $1.4 billion and the company controlled more than 60 percent of the American market. Both it and the industry it dominated continued to be major contributors to the nation s economy until after World War II, when union labor costs and aging technology conspired to send the domestic steel industry into a long, inexorable decline that ultimately resulted in its death. At the same time, steel manufacturing facilities began to appear offshore in countries like Korea and China, where labor costs were extremely low, technology was more modern, and product quality was high. Combined with a dramatic decline in transportation costs, these offshore advantages resulted in the decline and fall of the American steel industry. In the early 1970s a consolidation
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