Taiwan

Faced with a disastrous downturn in a vital industry, chip making, Taiwan is experimenting with a novel way to try to save it.

With at least two leading chip manufacturers teetering on the edge of bankruptcy, the government in recent weeks has introduced the broad outlines of a plan to create a new entity, called Taiwan Memory, to support production. It aims to balance concern about taxpayers' wrath over the use of public money against the threat of a banking crisis and anger over thousands of lost jobs if one or more of the companies fail.

How many rumors does it take to equal a fact? Or put another way, at what point does a flood of rumors start to look like a marketing campaign? As Apple netbook rumors swirl through the media for a third straight day, the slow but steady trickle of information has a deliberate quality that suggests planning.

Reports from the Far East have added fuel to the rumors that Apple is planning to enter the fast-growing netbook market this year. The Dow Jones Newswire, citing sources "close to the situation," confirmed Monday's reports by the Commercial Times of Taiwan that Apple is working with Taiwan's Wintek and Quanta Computer on a touchscreen netbook.

Here's a rumor that can be taken with a big pinch of MSG: A Taiwanese newspaper called the Commercial Times is reporting that Wintek, a Taiwan-based screen manufacturer, is set to deliver touch panels for a new Apple netbook in the third quarter. No specific shipment schedule has been set, the paper said.

The Commercial Times went on to add that the netbook will be manufactured for Apple by Quanta Computer, which among other things has manufactured parts for Apple's enormously successful iPhone.

Taiwan's government said it wants the island's ailing memory chip industry to choose between America's Micron Technology Inc. and Japan's Elpida Memory Inc. to help the chip makers consolidate and end a string of massive losses.

The island's six makers of DRAM, or dynamic random access memory, chips have suffered from a glut of supply as the global economic slump saps demand for electronics and machinery run with semiconductors.

Intel has taken the wraps off four new Atom processors and two control hub chips for use in low-power embedded applications. It also announced a new memorandum of understanding under which customers of Taiwan-based chip foundry TSMC eventually will be able to produce customized Atom designs for embedded applications using TSMC's processes, IP, libraries and design flows.

Thinking small might help Taiwan's computer industry emerge from the global downturn as an even bigger global player.

While the worldwide computer market is suffering through its worst sales in years, one bright spot is coming from the mini-laptops known as "netbooks," which appeal to the budget-conscious in tough times.

Several research groups have forecast that global demand for the thin, light machines could double this year -- and the category is dominated by Taiwanese brands and Taiwanese contract manufacturers.

Positioning device maker Garmin has dropped plans to enter the cell phone market on its own and instead teamed up with Taiwan's low-cost PC maker Asustek, the companies said on Wednesday.

The move to jointly offer navigation phones -- often called GPS phones, because they can determine a person's exact location -- builds on an existing manufacturing deal between the companies, and comes as the phones continue to gain in popularity among handset users.

The global credit crisis may have caused the decline in consumer and business spending that is assaulting the giants of technology. But as the dominant companies try to emerge from this slump, they may find themselves blaming people like David Title just as much as they blame Wall Street.

In recent years, Korean, Taiwanese, and Japanese makers of liquid-crystal display panels have fought hard to establish dominance in the key tech market. And for most of 2007 and 2008 there was plenty of business to go around. Today, though, the economic crisis is slashing demand for the panels, used in flat-panel TVs, computer monitors, and cell-phone screens. While that's likely to hurt everyone in the battle, the Koreans expect the downturn to play out to their advantage.