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ALBANY, NY – IBM Corp. will invest $1.5 billion in Albany and will build a semiconductor plant somewhere in upstate New York.

The investment is expected to increase research jobs to 325 at the University at Albany's College of Nanoscale Science and Engineering. The state government is providing $25 million for new semiconductor equipment at that site.

In addition, the company will construct a 120,000 sq. ft. semiconductor packaging center at a location to be determined. Albany NanoTech will own and manage the facility, which reportedly will create more than 675 jobs.

In total, the state will spend $140 million, with IBM investing more than $10 for every $1 that New York spends, say published reports.

SAN FRANCISCO – SEMI anticipates global semiconductor equipment sales of $34 billion in 2008, down 20% year-over-year.

Survey respondents see the equipment market growing 13% in 2009 to $38.6 billion, and reaching just more than $41 billion by 2010.

China will hold steady in terms of equipment spending this year, but all other markets will be down from their 2007 levels, says SEMI. Taiwan, the largest equipment market last year, will drop 37% to $6.7 billion in 2008, but is forecasted to bounce back next year with 53% growth. North America will decline 13% to $5.7 billion, according to the forecast.

Wafer processing equipment will fall 20.5% to $25 billion, says the firm. The market for test equipment is expected to decline 20% to just over $4 billion this year, while the assembly and packaging equipment segment will fall 14% to $2.4 billion.

Since the semiconductor business has become a consumer-driven industry, it needs to handle short-run, rapid-change products to accommodate the short lifecycles of the consumer market; smaller fabs are better suited for this, according to SEMI.

R&D dollars for device shrinks, new processes and new materials are highly constrained and must be invested where they will offer a positive return, the firm adds.

The change to a larger wafer size in itself does not lead to significantly reduced costs. Intel found this was the case in the changeover from 150 mm to 200 mm, and the same will be true in going to 450 mm. Overall cost reductions for 300 mm wafers were brought about by higher usage of factory automation, the use of mini-environments or FOUPs, and savings brought on by stopping work on 200 mm node advancement, says SEMI.

Separately, in the keynote at Semicon West today, Jim Clifford, senior vice president and general manager of Qualcomm CDMA Technologies, said one of the hottest end-product markets is mobile communications, SEMI points out.

The global handset market has reached about 1.2 billion units and is expected to grow to 1.6 billion by 2012. Entry level phones – those selling round $20 – will grow at the fastest rate, accounting for about half the handset total by 2012, according to Clifford.

The entry-level phone market is being driven by demand in China and India, and the market will continue to grow as those consumers move up the ladder to more feature rich phones, he said. He said currently there are about 800 million people in rural China who are not serviced by mobile phones – and each month 5 to 7 million phone subscribers are added in China.

In India’s market, the price of handsets has come down from $99 to around $22, giving millions of people access to information via the Internet, said Clifford.