Highline stories:
- 8. The wireless shortage. The incredible boom in sales of wireless handsets spurred the start of a new kind of shortage that the industry had never seen before: a paucity of a select group of components used in cell phones, including capacitors, RF devices and flash memory. Growth in wireless handset business in 2000 was actually limited by scarce availability of these parts, not by demand.
- 7. Dot-coms become dot-gones. In 1999 and early 2000, a large, insurgent group of start-up dot-coms promised to reshape the electronics supply chain and threatened to overturn the distribution establishment. However, the dot-com craze crashed on Wall Street and the industry seemed to come to the realization that clicks are nothing without bricks. By the end of 2000, the ranks of the dot-coms had thinned due to consolidation and the traditional distribution players were once again holding the reins of the business-to-business movement.
- 6. Wall Street punished success. The irrational exuberance of 1999 and early 2000, where dot-coms that had never made a penny achieved billions of dollars in market capitalization, was replaced by irrational pessimism. This pessimism caused the stocks of major microelectronics and capital-equipment firms to plunge, despite the fact that 2000 was shaping up to be the best year in the history of chip industry. Only time will tell if Wall Street knows something that the entire industry doesn't.
- 2. Communications takes over. Semiconductor industry observers long have predicted that communications would overtake computing as the growth driver for the industry. In 2000, these predictions finally came true. Communications applications now are driving every aspect of the chip industry, from fab strategies to EDA, product development, marketing and investor relations. Capacitors, flash and DSPs replaced graphics chips, DRAM and microprocessors as the hot -- and scarce -- products. The future leaders of the semiconductor market are those companies that are focused on the communications market.
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