The last semiconductor downturn saw engineers focus on cost reduction that will now have an impact on the supplier front. In the CMP consumables sector, a new report from Techcet Group, “CMP Consumables 2010 Critical Materials Report,” highlights that work on process optimization has led to slurry dilution efforts and new CMP pads being qualified that have driven down consumable costs. Despite renewed growth, combined CMP pad and slurry market is forecast to be between US$1.36 billion and US$1.57 billion in 2010, Techcet does not expect the market to return to 2007 record levels until 2012.
In contrast to semiconductor equipment sectors that have been consolidating over the last 10 years, there are a record 15 slurry suppliers who have established sustainable revenue streams in at least one CMP process segment, according to Techcet.
Although Cabot Microelectronics remains the dominant player with approximately 38% market share overall. Six other slurry suppliers have established shares ranging from 5% to 11%. The supremacy of Dow (Rodel) in CMP pads has been breached by 4 suppliers, each with 3-5% share, although Dow still holds a commanding 78% lead.
New pad evaluations have also resulted in ASP pressure consistent with a robust competitive environment, signalling a break in the long-standing dominance of a single supplier.
The slurry dilution efforts, which have focused on selective STI and copper had been expected to be the primary revenue growth engine before the downturn, so 1:1 and 1:2 dilution takes a significant bite out of the revenue stream.
Techcet said that the introduction of new device structures has called for the commercialization of a variety of new single-layer slurries, each of which carries a fixed product development cost without the multi-layer ROI lure of tungsten and copper slurries.