Japan disaster slows cell phone manufacturing

Computerworld - The disaster in Japan could cause a short-term slowdown in the manufacturing of cell phones, analysts say.

The March 11 earthquake and subsequent tsunami and power outages in Japan have caused significant problems for computer chip manufacturing, as well as delays in the transportation of supplies to processor makers.

Research firm IHS iSuppli this week added that the disaster is impacting the production of complementary metal-oxide semiconductor (CMOS) image sensors. Shortages of that one component, iSuppli analyst Pamela Tufegdzic told Computerworld, will likely cause a slowdown in cell phone production.

"Cell phone manufacturers are waiting for these supplies, so production will slow down," Tufegdzic said. She noted that she expects the problem to last for three months or less.

Tufegdzic added that it remains unclear at this point whether a slowdown in production will cause cell phone prices to rise.

CMOS technology is used in building integrated circuits for microprocessors and microcontrollers; it's also used in analog circuits in image sensors and transceivers.

The research firm noted that two Japanese facilities that manufacture these sensors were affected by the disaster.

ISuppli reported that Toshiba Corp.'s Iwate Image Sensor fab, which produces logic chips and CMOS image sensors for mobile phone cameras, remains shut down because of extensive damage. The company itself reported earlier this week that executives there expect to restart partial production next week. The initial reopening plan was delayed because of a strong aftershock on April 7.

Toshiba, which in 2010 was the world's fifth-largest supplier of handset image sensors, has said that it's leaning on its other manufacturing facilities to alleviate the impact on its customers.

Sony, the sixth largest global supplier of image sensors, is maintaining its regular manufacturing operation, but the disaster has caused problems in transporting CMOS image sensors to cell phone manufacturers, iSuppli noted.

"With their low cost and easy integration with other electronics, CMOS has long been the technology of choice for cell phone cameras," Tufegdzic said. "The Japan earthquake and subsequent logistical challenges have disrupted a portion of the supply of this key component."

The research firm also pointed out that supplies of an alternative image sensor technology -- Charged-Coupled Devices or CCDs -- appear to be unaffected by the disaster at this point. CCD image sensors, however, offer a higher image quality and generally are used in digital still cameras, while CMOS sensors are more traditionally used in mobile phones.

As Japan deals with massive loss of life, a nuclear meltdown crisis, extensive damage to roads, buildings and entire communities, and rolling electrical brownouts and blackouts, its manufacturing industry and economy have suffered.

And with Japan's technology business so intrinsically tied to the high-tech industry here in the U.S. and in countries around the world, the business effects of this disaster will be widely felt.

Late in March, analysts at iSuppli said no other disaster has hurt the global semiconductor industry more than last month's earthquake and tsunami.

Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin, or subscribe to Sharon's RSS feed . Her e-mail address is sgaudin@computerworld.com.

Read more about Mobile/Wireless in Computerworld's Mobile/Wireless Topic Center.