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Tech Industry

Chip sales continue to rise in gloomy market

The semiconductor industry showed strong yearly growth in November, according to a trade group, but the pace of growth is clearly declining.

The semiconductor industry showed strong yearly growth in November, according to a trade group, but the pace of growth is clearly declining.

The Semiconductor Industry Association of San Jose, Calif., reported that November 2000 chip sales were up 28 percent from November 1999, reaching $18.28 billion.

The market segments that saw the strongest growth included communications and Internet infrastructure, where products such as flash memory and communications chips were used to power handheld computers, cell phones and other devices, the SIA reported.

Regionally, the Japanese market saw the strongest year-to-date sales growth, rising 38.9 percent, followed by the Asia-Pacific region's 20.9 percent growth and the Americas' 30 percent growth, the report said.

But despite strong growth compared with 1999, month-to-month semiconductor sales in the Americas and Asia-Pacific regions were down, the report said.

The Americas slipped 5 percent in November compared with the previous month, falling to $5.6 billion from $5.9 billion. Asia-Pacific fell by 3.5 percent, posting $4.4 billion, down from $4.6 billion. Sales in Europe were virtually flat, rising 0.1 percent to $3.81 billion, the report concluded.

Despite the slipup in month-to-month sales, SIA remains bullish on its projections for the remainder of 2000 and the new year.

"The chip industry remains on track to achieve sales of $205 billion in 2000," SIA president George Scalise said in a release. "We expect to approach our historic 17 percent compound annual growth rate in the first quarter of 2001."

Dataquest chimed in with its chip industry predictions on Tuesday. The firm said chip sales were up 31 percent in 2000 to $222.1 billion. However, compared with the growth percentages for 2000, 2001 chip sales will be down at around 20 percent, the firm said.