98-4

Planning 

Report

Metrology-Related Costs in

the U.S. Semiconductor Industry, 

1990, 1996, and 2001

Prepared by:

Technecon Analytic Research

for

National Institute of

Standards & Technology

Program Office

Strategic Planning and

Economic Analysis Group

May 1998

U.S Department of Commerce

Technology Administration
Metrology-Related Costs in the

U.S. Semiconductor Industry,

1990, 1996 and 2001

NIST Contract #50-SBNB7C1045

William F. Finan

Technecon Analytic Research

Suite 200

2445 M Street, NW

Washington, D.C. 20037

May 1998
Table of Contents

Executive Summary i-vi

I. Introduction 1

Organization of Report 3

Acknowledgements 5

II. Defining Metrology-Related Costs in the

Semiconductor Industry 6

A. Physical Measurements Important to the

Semiconductor Industry 7

B. Metrology-Intensive Segments of the

Semiconductor Industry 9

C. Measuring Metrology-Related Costs 15

D. Metrology-Capability Supplying Industry 19

E. Summary of Study Objective 19

III. Determining Metrology-Related Costs for the

Semiconductor Industry 20

A. Determining the Size of the U.S.-Based MCS

Industry – Supply Side 20

B. Determining the Size of the U.S.-Based MCS

Industry – Demand Side 28

C. Demand Side Estimate 41

D. Size of the Metrology Infrastructure in 2001 42

IV. Summary 44

Figures 1 – 5

Appendix A: Measurement-Related Attributes

Appendix B: List of Segments

Appendix C: Individuals Interviewed

Appendix D: Example of Questionnaire Used in Interviews

Appendix E: List of Metrology Capability Supplier Companies
List of Tables

Table S.1: Supply-Side Estimate of Total U.S. MetrologyRelated Costs ii

Table S.2: Demand-Side Estimate of Total U.S. MetrologyRelated Costs iii

Table S.3: Comparison of Trends in Estimated Total MetrologyRelated Costs to World Semiconductor Industry

Revenues, 1990, 1996 and 2001 iv

Table S.4: List of Physical Measurements Used by the

Semiconductor Industry vi

Table 1: List of Physical Measurements Used by the

Semiconductor Industry 10

Table 2: Supply-Side Estimate of Total U.S. MetrologyRelated Costs 26

Table 3: % of Total R&D Metrology-Related Costs for U.S.

Semiconductor Equipment Companies 32

Table 4: Metrology Costs in the Semiconductor Equipment

Industry 35

Table 5: Demand-Side Estimate of Total U.S. MetrologyRelated Costs 42

Table 6: Comparison of Trends in Estimated Total MetrologyRelated Costs to World Semiconductor Industry

Revenues, 1990, 1996 and 2001 45

Table A.1: Measurement-Related Capabilities by Category of

Wafer Processing Equipment A.3
List of Figures

Figure 1: Overview of Scope of Metrology Costs Covered by this Study

Figure 2: Semiconductor Equipment Metrology Costs Included in the Scope

of this Study

Figure 3: Gas, Chemical and Water Supply Metrology Costs

Figure 4: Three Types of Analytical Labs

Figure 5: Metrology Capability Suppliers Supply the Metrology Cost

Centers with Equipment/Instruments
1

Metrology-Related Costs in the U.S. Semiconductor Industry,

1990, 1996 and 2001

NIST Contract # 50 – SBNB7C1045

I. Introduction

This study estimates the amount of metrology-related costs in the semiconductor

industry, including the industry’s infrastructure, for 1990 and 1996 along with a

projected range for 2001. It is the first study that determines the size of metrologyrelated costs across all metrology-intensive segments of the semiconductor industry,

including the industry’s infrastructure. “Metrology-related costs” in this study is the value

of current period spending by the semiconductor industry to acquire what we designate

as “metrology capability.” Because we limit metrology-related costs to current spending

for equipment, we use the terms “metrology costs” and “metrology investment”

interchangeably.

This study was prepared under the sponsorship of the National Institute of

Standards and Technology (ANIST”) in order to provide NIST with a better

understanding of metrology investments made by the U.S. semiconductor industry. 

NIST’s interest in this issue arises out of its mission to work with U.S. industry to

develop and apply technology, measurements, and standards. 

NIST's mission is straightforward and unique...NIST promotes U.S. economic

growth by working with industry to develop and apply technology, measurements

and standards -- providing the basic technical infrastructure needed by U.S.

industry. We concentrate on industry because it is industry that transforms
2

technology into the products and services, the profits and jobs that yield the true

returns to American taxpayers.1

In the case of the semiconductor industry, it is NIST’s Office of Microelectronics

Programs (“OMP”) that has the responsibility to integrate NIST’s research program with

the needs of the U.S. semiconductor industry.2

This study is not an assessment of metrology technology characteristics nor

does it identify new metrology applications in the semiconductor industry. Metrology

technology requirements are spelled out in the Semiconductor Industry Association

(“SIA”) technology roadmap, The National Technology Roadmap for Semiconductors –

Technology Needs, 1997.3 The SIA Roadmap defines metrology technology

requirements related to microscopy, sensors, materials and contamination, and

reference materials. 4 Our definition of metrology differs from the one applied in the SIA

Roadmap because it expressly excludes costs associated with in situ metrology

capabilities. According to the SIA Roadmap, A[m]etrology must migrate from off-line to

in-line and in situ to achieve the Roadmap goals. While installing in situ capabilities

 

1

Statement of Arati Prabhakar, Director, National Institute of Standards and Technology

Before the Subcommittee on Commerce, Justice, State, The Judiciary, and Related Agencies,

Committee on Appropriations, House of Representatives, March 15, 1995.

2 OMP works with the Semiconductor Industry Association (“SIA”), the Semiconductor Research

Corporation (“SRC”), SEMATECH, and other organizations.

3

Hereafter, “SIA Roadmap.”

 

4

SIA Roadmap, p. 179.
3

may emerge as a major cost for the semiconductor industry in the future, we do not

speculate about its potential impact.5

Organization of Report

We made a significant effort to develop definitions for metrology activities and

costs as they relate to the semiconductor industry. Some background may be helpful to

explain why this was necessary. Section II discusses in detail the definitions we apply in

this study. Understanding these definitions is important to correctly interpreting our

results.

In originally designing the research strategy for this study, we believed that we

could rely on a mail survey instrument to collect market data together with follow-up

interviews. However, once we commenced the study it soon became apparent that this

approach was not workable. During meetings with experts knowledgeable about

metrology applications in the semiconductor industry at NIST, and later at

SEMI/SEMATECH and SEMATECH, we learned there was not widespread agreement

on what constituted metrology activities in the semiconductor industry. Furthermore, no

single person was capable of defining the scope of the entire metrology-related

“industry.” Our first task, therefore, became to develop a set of definitions to apply in

structuring the data collection effort, including a taxonomy of metrology activities in the

 

 

5

See S. Butler, J. Hosch, A. Diebold, and Brad Van Eck, ASensor Based Process and Tool Control,@

Future Fab International. According to them, the 1994 Roadmap suggested that a shift from off-line and

in-line metrology to sensor-based process and tool control was coming, most likely in connection with the

implementation of process tools for 300mm wafers. 
4

semiconductor industry. This was accomplished through extensive interaction with

NIST, SEMI/SEMATECH, and SEMATECH. At the same time, we identified other

experts who could provide information on specific metrology activities in the

semiconductor industry.6 These experts provided details on metrology functions and

also identified some of the leading firms supplying metrology capabilities to the

semiconductor industry.7,8 

Section III provides our estimates of U.S. metrology-related costs for the U.S.

semiconductor industry for 1990 and 1996. We developed our estimates using two

methods: (1) a “supply side” approach that relies upon identifying all metrology firms

and totaling their metrology-related revenues, and (2) a “demand side” approach that

relies on determining metrology-related costs for four segments of the semiconductor

industry that utilize metrology the most intensively. We also benchmark our estimates

for growth of metrology-costs between 1990 and 1996 by making comparisons to the

growth of total semiconductor device and semiconductor equipment revenues. This

section also provides insights into the factors driving increases in metrology costs in the

semiconductor industry. We extrapolate the trend in the growth of metrology costs to

2001 consistent with projections of the growth in the semiconductor industry.

 

6 We also did a search of recent technical journal articles to identify experts in various technical

specialties.

7

 Appendix C lists the individuals interviewed.

8 We developed a questionnaire tailored to each metrology segment included in this report. Appendix

D provides an example of the questionnaire used to collect data on the metrology equipment which

measures electrostatic discharge in semiconductor clean rooms.
5

Five appendices provide supporting information. Appendix A defines

“Measurement-Related Attributes.” Appendix B lists the segments of the

semiconductor infrastructure from which firms were identified as metrology suppliers to

the semiconductor industry. Appendix C provides the list of individuals interviewed for

this study. Appendix D provides an illustration of the survey form that was used to

structure interviews. Appendix E lists the companies identified in the report as

providing metrology capability to the semiconductor industry.

Acknowledgements

There are certain individuals who require special recognition because, as difficult

as it was to develop a workable methodology to carry out this study, it would not have

been possible absent the significant input of time from them: Robert Scace, NIST;

Robert Bachrach, Applied Materials; Pat Gabella, SEMI/SEMATECH; and David

Jensen, SEMATECH. I especially want to thank Alain Diebold, SEMATECH, who never

failed to answer my questions with, what can only be described as, an encyclopedic

knowledge of metrology-related topics.
6

II. Defining Metrology-Related Costs in the Semiconductor Industry9

This section presents the definitions used to structure the data collection

process. Since it is the first study that measures metrology costs in all segments of the

semiconductor industry “food chain” – semiconductor device manufacturers plus the

infrastructure – some definitions differ from the most common usage in the

semiconductor industry. Several definitions are even unique to this study. Because of

these differences, it becomes particularly important to review all of the definitions

presented here before interpreting the results provided in Section III. Why was it

necessary to develop a special set of definitions? Certainly an industry studied as

intensively as the semiconductor industry has already been thoroughly characterized. 

The answer is found in the breadth of the scope of the study: No previous study of

metrology costs in the industry has attempted to measure metrology costs in all

segments of the semiconductor industry food chain for all types of metrology activities.10

 Measuring the semiconductor industry’s total investment in metrology capability

required broader definitions of metrology investment than was used in prior evaluations.

 In addition, in order to identify a reasonable boundary for the scope of the study, it also

required using a different definition for the semiconductor industry than the one that

 

9

Again, as noted above, we are using the term “costs” interchangeably with the term “investments” for

the purposes of this study.

10 Market research firms such as VLSI Research and DATAQUEST, for example, routinely provide

information on the size of the metrology equipment market. But, as explained in Section III, their data

covers only a relatively small fraction of the total metrology supplying industry, as we define it.
7

was commonly applied. This alternative definition included certain segments of the

infrastructure not normally considered to be a part of the industry because they are

metrology intensive while simultaneously excluding certain segments, for reasons

explained below, that are usually defined to be a part of the industry’s food chain.

This section starts by specifying how we define metrology and the scope of the

semiconductor industry for the purposes of this study. Our definition of the

semiconductor industry spans both device makers and the industry infrastructure. This

broad definition for the industry, in and of itself, is not new since it is based on the

widely accepted concept of the industry’s food, but it differs by limiting the industry’s

scope to four metrology-intensive segments. We then turn to the central issue: How to

measure the semiconductor industry’s investment in metrology capability for these four

metrology-intensive segments?

A. Physical Measurements Important to the Semiconductor Industry

Broadly speaking there are two types of measurements performed in the

semiconductor industry: physical measurement and final electrical test. We exclude

final electrical test from the scope of this study because, traditionally, NIST is more

focused on supporting physical measurements.11 Our objective is to determine the

semiconductor industry’s investment in the infrastructure needed to support all types of

physical measurements.

 

11 It is not strictly correct that all forms of electrical tests are excluded. The experts we consulted

recommended inclusion of in-line electrical test for resistivity as a physical measurement.
8

Physical Measurements

In the context of the semiconductor industry, physical measurement frequently

refers only to physical measurements made as part of in-line process control. For

example, 

The semiconductor industry refers to measurements used in process

control as metrology. Engineers often use the word to describe

procedures, such as critical dimension (CD) measurements, which

routinely monitor lithography processes inside the clean room. Others

generalize it to all in-line measurements. According to the dictionary,

metrology is the science of measurement. It should also be noted that

metrology includes all aspects both theoretical and practical with

reference to measurements, whatever their uncertainty, and in whatever

fields of science or technology they occur. The term characterization is

also used interchangeably with metrology.12

This definition is too restrictive to be applied in this study because it fails to include offline physical measurements and also implicitly limits measurement to “inside the clean

room” (the wafer fabrication stage of semiconductor manufacturing). 

We include all off-line measurements performed in all segments of the

semiconductor industry when determining total spending on metrology equipment.

 

 

12 T. Shaffner, A. C. Diebold, R. C. McDonald, D. G. Seiler, and W. M. Bullis, ABusiness and

Manufacturing Motivations for the Development of Analytical Technology for Semiconductors,@ in W. M.

Bullis, et. al. ed., Semiconductor Characterization, Present Status and Future Needs. New York: American

Institute of Physics: 1996, pages 1- 2.
9

Types of Physical Measurements Used in the Semiconductor Industry

Based on interviews, we identified 16 types of physical measurements used in

the semiconductor industry.13 These 16 measurements are listed in Table 1. (Appendix

A provides more detailed descriptions.) The number of semiconductor equipment

families that use each type of measurement is shown in the second column of the table.

 Time interval measurement is used almost in all types of semiconductor equipment

while stress & strain and resistivity measurements are required in only one type of

equipment.14 In developing data on metrology costs, we determine the spending on

hardware to support these 16 types of measurements.

B. Metrology-Intensive Segments of the Semiconductor Industry

Because the objective of this study is to extend NIST’s knowledge about

metrology activities in all segments of the semiconductor industry, we apply a broad

definition of the “semiconductor industry.” Specifically, this study includes significant

portions of the industry’s infrastructure in order to measure metrology activities at all

levels of the industry’s food chain, especially the more metrology-intensive segments.

 

13 We prepared a list of measurement activities and then asked NIST, SEMI/SEMATECH, and

SEMATECH representatives to comment on it. Table 1 presents the final consensus on the physical

measurements required by the semiconductor industry.

14 See Appendix A, Table A.1.
10

Table 1

List of Physical Measurements Used by the Semiconductor Industry

Measurement Category

Number of Semiconductor Equipment Tools

Requiring This Measurement

(out of 16 total tool families)

1. temperature gradient & absolute 13

2. physical dimensions

 thickness / weight / position

12

3. pressure total / partial 11

4. Adose@ radiometry flux 7

5. optical properties intensity polarization

 spectral distribution / bandwidth

6

6. flow rate 11

7. contamination particulates

 (size / distribution) gas phase

13

8. Rf power 5

9. handling 14

10. effluents 12

11. time interval 15

12. magnetic field measurements 4

13. end-point distribution emission / 

 coherence shift & composition

6

14. chemical composition liquid & solid

 (excluding gases)

2

15. stress & strain 1

16. in-line electrical test resistivity 1

Source: See Appendix A, Table A.1.
11

The Semiconductor Industry

The “semiconductor industry”, for the purposes of this study, includes

manufacturers of semiconductor devices, suppliers of semiconductor

equipment and materials, and providers of analytical lab services.

Three segments usually considered part of the industry’s infrastructure were

excluded from our definition of the semiconductor industry. First, we excluded all

materials suppliers’ metrology investments prior to delivery of consumables to the wafer

manufacturer facility (i.e., costs outside the wafer fab “barrier” or boundary in order to

define a practical limit on the investments included and excluded. Second, after

discussions with NIST, we excluded semiconductor-related activities of the federal labs,

including NIST. And, third, we excluded universities.15

“U.S. Base” of Metrology Costs

As indicated in the introduction, NIST’s mission is to support U.S. industry. 

Therefore, we sought to measure the size of the U.S. metrology industry infrastructure,

which we defined as U.S. metrology-supplying firms. It is difficult, in practice, to

precisely identify metrology costs incurred only by U.S. semiconductor companies or

only by U.S. semiconductor companies in their U.S. operations. It is equally difficult to

identify metrology costs just for the U.S. market (which would cover all semiconductor

operations located in the U.S. regardless of ownership). 

 

15 In practice, metrology investment by federal labs, NIST, and universities is reflected in the total

cost data we report in Section III because we did not attempt to net their purchases out of the total

metrology spending data.
12

Either way we define the U.S. “base” of metrology costs – that is, either by

referencing metrology consuming firms or metrology supplying firms – it is not the same

as measuring the size of the U.S. metrology market. We can identify U.S.

semiconductor industry consumption of metrology capability wherever it occurs in the

world. Using the U.S.-headquartered device producer Texas Instruments (“TI”) as an

example, we would include TI’s investment in metrology in its Japanese and Italian

operations in our U.S. base number. Alternatively, we can identify the U.S. base of

metrology supply as the total for metrology equipment supplied to the world by U.S.-

headquartered suppliers, that is, U.S. demand plus exports. 

Because we can most reliably measure total metrology supply for U.S.-

headquartered firms and foreign affiliates – the “U.S. base” of total

metrology supply – we use this definition when we apply a ‘supply side’

method to estimate U.S. metrology-related investment. This definition was

also selected because it most closely approximates the metrology

“market” for NIST’s semiconductor industry-related services and research

results.

Metrology-Related End-Use Segments (or “Cost Centers”)

The “demand side” approach to determining the total size of the metrology

infrastructure supporting the semiconductor industry relies on data developed for

the four segments of the semiconductor industry that are metrology intensive. 

We use the term “metrology-related end-use segments or “cost centers” to refer
13

to the metrology-intensive segments of the semiconductor industry’s food chain

where metrology costs are relatively the most important. The four end-use

segments are: wafer fabs (including clean room, clean room shell, and

structure)16, analytical labs (both captive and independent)17, semiconductor

equipment manufacturing (metrology capability embedded in original equipment,

metrology costs in tool manufacturing and metrology costs associated with tool

development), and consumables delivery systems to wafer fabs (for gases, deionized water, and chemicals). See Figure 1.

• Wafer manufacturing or wafer fab refers to the wafer fabrication structure, clean

room shell, and clean room. Excluded from the scope of the facilities definition are

installed process equipment and consumables delivery systems because these are

covered under the semiconductor equipment and consumables cost centers,

respectively.

• The semiconductor equipment industry is both a source of demand for metrology

capabilities and analytical lab services as well as a supplier of metrology equipment

to the semiconductor industry. In developing our estimate of aggregate size of the

Metrology-Capability Supplying (“MCS”) industry, we separate wafer process tools

from the general category of wafer fabrication tools. Wafer process tools include

film thickness instruments, microscopes (scanning electron microscopy or “SEM”

and AFMS), and wafer defect inspection tools. To be clear, we do include process

metrology tools in our evaluation, but we report this segment separately to provide

NIST with an understanding of the amount of metrology costs related to the other

MCS industry segments. Semiconductor equipment-related metrology costs fall into

two broad categories: metrology costs embedded in a tool (e.g., a temperature

measurement instrument) and spending on metrology capabilities during tool

development.18 See Figure 2. This second category can be further subdivided into

 

16 Metrology investments associated with pilot production lines are included as part of front-end

facilities investment.

17 “Captive” means the lab is an internal facility that almost exclusively supports a semiconductor

producer’s in-house requirements.

 

18 Embedded metrology costs can be further categorized as either related to monitoring tool

performance or measuring product quality. We did not attempt to provide data at this level of detail.
14

metrology instruments/equipment purchased for tool characterization and analytical

lab services. Analytical lab services are mainly purchased from independent

companies, although several of the larger equipment companies have in-house labs.

• Consumable delivery system metrology costs start “inside the barrier” – that is, after

the point of delivery to a wafer fab site. See Figure 3. These costs fall into two

categories. The first category is in-line monitoring equipment and instrument costs. 

The second category is off-line analytic lab costs (whether associated with a captive

or an independent lab). Consumables suppliers’ metrology-related investments at

their production facilities are excluded from the scope of the study in order to define

a practical limit to the coverage of metrology costs.

• Analytical labs come in three flavors: in-house labs located inside or adjacent to a

clean room facility, in-house, stand-alone facilities (frequently co-located with a

company’s research facility), and independent labs. See Figure 4. After extensive

discussions with experts familiar with the activities of analytical labs, we concluded

that we could not expect to develop reliable survey data about either device

companies’ captive labs or independent labs. Captive labs typically do not report to

a single cost center, therefore, sources of information about a company’s labs are

diffused. We determined that companies would be hesitant to undertake the

extensive effort required to provide data for all of their labs. Similarly, all of the

independent labs are privately held; information on their activities would be equally

difficult to obtain. Therefore, we determined that we would use other means to

measure metrology-related investments at these facilities. Again, as noted above,

we are measuring spending for metrology-related instruments and equipment, not

operating costs.

We measure gas, chemical and water delivery systems metrology-related costs

Ainside the barrier” of the wafer fab, that is, at the customer site. As stated above, all

upstream metrology-related investment costs are excluded. We also excluded all

metrology-related investments by raw silicon wafer suppliers because we were unable

to obtain reliable information.19

 

19 This problem arose, in part, because nearly all of the major wafer suppliers are foreign

headquartered.
15

Several other segments of the semiconductor manufacturing sequence were

excluded, in particular, assembly (including packaging) because based on our

interviews, they were judged to be less metrology intensive or related to final electrical

test which is outside the scope of the study.

The demand-side valuation of the size of the metrology infrastructure estimates

the amounts of metrology-related spending for each metrology cost center and totals

them to arrive at the estimate for the total industry.

C. Measuring Metrology-Related Costs

We have specified “metrology-related costs” as the value of current period

spending by the semiconductor industry to acquire “metrology capability.” We begin

with a discussion of “metrology capabilities” and then more precisely define metrologyrelated costs.

Metrology-Related Capabilities

“Metrology-related capabilities” is defined as the semiconductor industry’s

acquisition of the means to carry out both in-line and off-line metrology functions related

to physical measurements. “Capability” refers to the semiconductor industry’s spending

to acquire metrology-related equipment, instruments, systems, sub-assemblies, and

components, but it excludes metrology-related operating costs at any level of the
16

semiconductor industry associated with actually taking measurements or providing

related analytical lab services.20

Metrology-Related Costs

Measuring semiconductor industry “metrology-related costs” is the central

objective of this study. Developing reliable data on metrology-related costs in the

semiconductor industry is not an easy task. First, as already explained above, we

found that we could not apply an “off-the-shelf” definition of metrology. Interviews with 

experts familiar with metrology requirements in the semiconductor industry led us to

define particular metrology activities that, in turn, generated cost requirements

throughout the industry. Second, we could not go to a single set of firms at a particular

level in the semiconductor industry, say device manufacturers, and collect all the cost

information required. Manufacturers of semiconductor devices would not know the

amount of metrology costs in other segments of the semiconductor industry’s food

chain. Hence, we needed a consistent methodology that allowed identification of

metrology costs in all segments of the industry. Third, based on our experience in the

industry, we knew that metrology-related cost data was not easily split out in a firm’s

cost accounting system. These costs tend to be a fraction of the total cost for a system

or structure. This meant we could not rely on a survey of device companies to yield

 

20 We should again be clear that analytic lab service firms and in-house organizations, to the degree

their activities relate to the semiconductor industry, fall within the scope of our definition for the

semiconductor industry. Metrology equipment purchased by analytical lab service firms is included in the

definition of the semiconductor industry’s metrology investments, but we do not include lab operating

expenses.
17

reliable results, assuming that they would have completed the survey form. We relied,

instead, on experts’ judgements to develop ranges for these costs for each metrology

cost center. Fourth, metrology costs as a percent of total semiconductor production

costs tend to vary significantly over time at a particular facility. Metrology costs are

relatively more important during the ramping of a new manufacturing facility when new

process steps require full characterization but diminish rapidly as production volumes

build and manufacturing processes stabilize. Because we provide only annual

estimates that aggregate across all facilities’ metrology-related spending, the growth

and decay of metrology costs relative to total manufacturing costs evident at a particular

facility will not be observable in the aggregated annual results. All of these

considerations influenced how we decided to define metrology-related costs.

Metrology-related costs in this study are the semiconductor industry’s

spending to acquire metrology capability to perform ‘physical

measurements’.

Except where expressly stated, we do not include operating expenses

associated with performing physical measurements in our definition of metrologyrelated costs. A current period total cost figure for total metrology costs would include

the amortization expense for metrology equipment plus period operating costs and

various overhead cost allocations. This approach would be the correct way to

determine total metrology-related costs if we were seeking to determine the portion of
18

total finished wafer cost represented by metrology.21 This definition would not, however,

correctly value the size of the U.S.- based, metrology-supplying industry consistent with

the objective of our study.

It is useful to reiterate that we do include in the scope of the study analytical labs’

current period spending for new metrology equipment and instrumentation but exclude

costs for analytical lab services.22

D. Metrology-Capability Supplying Industry

Firms who supply the semiconductor industry with both complete

metrology tools and instruments as well as intermediate assemblies and

specialized components for metrology systems comprise the Metrology

Capability Supplying industry and form the infrastructure that supports the

semiconductor industry.23

Section III explains how we measured the U.S.-based MCS industry.

 

21 This issue is discussed in Section III.

22 Another reason to exclude operating costs is simply the difficulty we encountered in obtaining

meaningful estimates for them. All of the independent analytical labs are privately held and unwilling to

provide detailed cost information. Likewise, detailed cost data for in-house analytical lab costs were

considered to be sensitive information.

23 The MCS industry and semiconductor industry definitions are not mutually exclusive since some

firms included in the MCS industry are also included in the scope of the semiconductor industry. For

example, KLA falls within the parameters of both.
19

E. Summary of Study Objective

We can state the study’s objective by using the definitions that frame the study’s

scope. 

The semiconductor industry – device companies plus selected portions of

the industry’s infrastructure – has four segments that utilize physical

measurements relatively intensively: wafer fabrication, inside the barrier

consumable delivery systems, semiconductor equipment manufacturers

(embedded costs, manufacturing-related costs, and development-related

costs), and analytical labs (both captive and independent). 

This study determines the semiconductor industry’s metrology costs in two ways.

 First, we determine the costs from the supply side by aggregating the metrologyrelated revenues of the U.S.-based MCS industry. Second, we estimate total metrology

costs from the demand side by estimating metrology-related costs for each of the four

metrology-intensive segments. Estimates are prepared for 1990 and 1996 with a

projection to 2001. See Figure 5.
20

III. Determining Metrology-Related Costs for the Semiconductor Industry

This section provides our estimate of aggregate metrology-related costs for the

semiconductor industry using two approaches. The first approach is a supply side

method that estimates the size of the MCS industry using company data. The second

approach is demand side: it evaluates metrology costs for each metrology-intensive

cost center and aggregates the cost center data to determine total metrology-related

costs. The summary section provides an overview of the results.

A. Determining the Size of the U.S.-Based MCS Industry – Supply Side

This part discusses how we determined the size of the U.S. MCS industry using

company data. The first step was to identify firms in the MCS industry. To do this we

relied on information developed during our interviews. We asked all of the individuals

interviewed to identify the leading companies who supplied metrology capability to the

semiconductor industry. Companies identified from the interviews formed our

preliminary list of MCS industry companies. To obtain a broad census of companies in

the MCS industry, we used the membership directory of Semiconductor Equipment

and Materials International (“SEMI”).24 Our judgement was that SEMI’s membership list

 

24 According to the Semiconductor Equipment and Materials International (”SEMI”) web site: “[SEMI]

is an international trade association that represents semiconductor and flat panel display equipment and

materials suppliers. Founded in 1970 in the United States, SEMI has evolved into an international

organization committed to free trade and open markets. SEMI's primary goal is to help its members

expand their global marketing opportunities and improve access to their customers and industry,

government and civil leaders. SEMI has more than 2,000 member companies located in North America,

Asia and Europe. Their products and services contribute more than $55 billion to the world economy.

Success in the semiconductor industry typically requires an international effort. SEMI members that

market products and serve customers worldwide often rely on the local expertise of SEMI employees at
21

of nearly 2,000 companies would include nearly all of the companies that we consider

to fall within the scope of the MCS industry.25 Since our interviewees identified the

major firms in the MCS industry, we believe that between our preliminary list and the

SEMI directory we could identify nearly every significant MCS industry member. The

SEMI directory provided other data such as a company’s semiconductor-only revenues.

 This information is extremely useful since many of the larger MCS industry firms supply

other end-markets.

The SEMI directory identifies over 300 possible product and application

categories for the semiconductor equipment and materials industry (including flat-panel

displays). An individual SEMI member will appear in as many product categories as

appropriate to cover all its product offerings. We took our preliminary list of MCS

companies obtained from our interviews and mapped it into the SEMI product

categories. That is, we determined the product categories that included nearly all of the

firms from our preliminary list. This exercise identified 20 SEMI product categories, out

of 300 total, that constituted the product categories for the MCS industry.26 See

Appendix B. Companies listed in the SEMI directory under each of these 20 category

 

these offices.”

 

25 SEMI annually publishes a membership directory. We used the 1997-1998 directory.

26 SEMI categorizes all 1,850 of its corporate members in the 1997-1998 directory by a general

product description, further broken down by specific type of product and service. For example, the

product description category AAnalysis/Measurement@ is further divided into 12 sub-categories: auger,

defect detection, electrical test, ESCA, film thickness, microscopes, probe stations/materials, probing

equipment/accessories, SEM, SIMS, surface inspection/flatness, and X-ray. Our 20 categories are taken

from more than 300 potential sub-categories.
22

headings constituted the potential set of firms providing metrology-related capabilities to

the semiconductor industry. Further screening of the SEMI companies was required to

determine the U.S.-based MCS industry companies.

Using SEMI=s 1997/98 Directory, we identified nearly 1,700 entities that fell into

the 20 categories. We use the term Aentities@ to denote the fact that a single company

may appear in multiple product categories. We aggregated the separate entities by

their common parent reducing the nearly 1,700 entities to 643 companies, both U.S.-

based and non-U.S.-based. To obtain a list of companies who manufacture and market

metrology-related equipment, we eliminated companies who had no U.S. sales

presence (that is, they only supplied metrology capability to offshore locations) or were

purely sales representatives or distributors. This reduced the total to 385 companies. 

This set includes foreign-headquartered companies who supply equipment to the U.S.

market.

An inspection of the 385 companies indicated we had not eliminated all of the

non-manufacturing companies. To further screen out the non-manufacturing

companies, we reviewed detailed company descriptions provided in the “SEMICON

WEST 97 Program Directory and Product Guide.”27 We selected this resource because

it was very current and provided details on a company’s functions. For example, a

significant number of companies eliminated at this screening were suppliers of

 

27 SEMICON WEST is the largest semiconductor equipment and materials supplier tradeshow in the

U.S. The tradeshow directory lists participants and provides company descriptions.
23

assembly and electrical test equipment; metrology was only a very minor part of their

business. We also removed companies whose principal line of business was analytical

laboratory services. We discuss these firms below. This additional screening left 258

companies.28 We then removed 59 non-U.S.-headquartered companies leaving a total

of 199 U.S.-headquartered companies that represent the U.S. base of metrologycapability suppliers. We further refined the list separating 22 companies who supplied

process monitoring equipment29 and removing from the list another 8 companies that

had no reported sales data. This left 169 companies. 

We define the total sales of these 169 companies together with the

22 process monitoring companies to be the value of the U.S. base of

metrology capability suppliers.30

Sales data for 1996 was obtained from the SEMI directory and supplemented by

company 10-K information if a company was publicly-held.31

We needed to make one adjustment to the reported sales data contained in the

SEMI directory. SEMI reports the range for semiconductor-related sales for all

categories of semiconductor products a company sells, not just metrology. We had to

 

28 We randomly selected 80 companies from this list – about 25% of the total – and conducted an

additional review to confirm that we had correctly identified the functions they performed. This additional

review relied mainly on information provided in a company’s internet web site.

 

29 This set is U.S.-headquartered only. There are major non-U.S. process monitoring equipment

suppliers who were already removed from the list.

 

30 Total metrology equipment costs would need to account for the process monitoring equipment

costs.

31 The SEMI directory reports a range for a company’s semiconductor-only revenues. We took the

mid-point of the range except for larger companies where we were able to obtain actual revenue data

using 10-K information or other sources.
24

estimate the metrology-only portion of total semiconductor sales. Fortunately, a large

portion of the MCS companies only sell metrology-related products and no adjustment

was needed. Further, we were able to confirm metrology-only sales for many of the

larger MCS companies using other sources. This left about 50 mid-sized MCS

companies with semiconductor-related revenues in the range of $15 million to $100

million for whom we needed to estimate the portion of their total sales related to

metrology. After evaluating several methods to accomplish this adjustment, we decided

the best method was to assume that between 40% and 60% of their total

semiconductor-revenues were metrology-related. This range was determined by

inspecting the mix of products sold by these firms. Most of the mid-sized firms had a

relatively large portion of their product categories related to metrology, hence we felt it

was reasonable to infer that a substantial portion of their revenues related to metrology

products. We concluded that applying a range of around 50% of total sales was a

reasonable way to estimate this adjustment for these 50 firms. 

To determine the size of the U.S. base of MCS companies for 1990, we

compared the list of 169 companies with the SEMI 1990 Directory and identified 71

matches. We determined the 1990 metrology-related revenues for these 71

companies.32 Appendix E provides the list of U.S.-based metrology capability

 

32 There are companies who may have exited the business after 1991 in which case we would not have

identified them. We do not believe this number is significant. Similarly, there may have been companies

who were acquired or merged after 1991; again we would not have identified them either. We did attempt

to verify how many companies were acquired. Our preliminary indication was that the number was small. 

Still, there is a likelihood that we are understating the true amount of metrology costs for 1990. The fact

that both the demand and supply-side methods yield consistent results for the growth of the industry

between 1990 and 1996 supports our conclusion that our understatement of 1990 metrology costs is not
25

companies, U.S.-based process monitoring equipment companies, companies

excluded due to lack of data, and foreign companies, including foreign-based process

monitoring companies.

Results of Applying the Supply-Side Method

We estimate, based on our supply-side methodology, that the size of the

U.S.-based MCS industry, measured by revenues, ranged between $1,980

million and $2,300 million in 1996. 

This total includes wafer process equipment suppliers identified as U.S.-based

MCS companies in 1996. We estimate that the U.S.-based MCS industry was $520

million in 1990 on the same basis. These results indicate that the MCS industry grew

by over 400% between 1990 and 1996 or at a compound annual growth rate (“CAGR”)

of between 22.3% and 28.1%. Net of process monitoring equipment, the size of the

U.S.-based MCS industry was estimated to be between $1,080 million and $1,400

million in 1996 versus $275 million in 1990 B an increase of 450% or a CAGR of 25.6%

to 31.1%.

If foreign-headquartered company sales are added to the U.S.-based MCS

industry (U.S.-based entity revenues plus sales of foreign entities in the U.S.), the size

of the U.S. MCS market is estimated to be $750 million in 1990 increasing to between

$2,525 million and $2,845 million in 1996.

 

significant.
26

Table 2

Supply-Side Estimate of Total U.S. Metrology-Related Costs

($ Million, except where noted otherwise)

1996

1990

Low

Estimate

High

Estimate

Metrology Process Tool Suppliers 245 900

All Other Metrology Suppliers

(net of process monitoring equipment) 275 1,080 1,400

 U.S.-Based MCS Industry 520 1,980 2,300

Compound Annual Growth Rate 22.3% 28.1%

U.S.-Based MCS Industry +

Foreign-Headquartered Sales 750 2,525 2,845

Structure of the MCS Industry

Comparing the data on the number of metrology-capability supplying firms in

1990 versus 1996 suggests a very high rate of entry into the industry during that period:

only 71 of the 169 companies present in 1996 could be identified in 1990. While there

are other possible explanations for the large difference, we believe there was, in fact, a

large number of new firms who commenced supplying metrology-capability to the

semiconductor industry between 1990 and 1996. Companies would have been

attracted to supply the semiconductor industry in early 1990’s because the

semiconductor industry experienced continued rapid growth becoming a very large end
27

market. Many firms who previously might have considered the semiconductor

industry’s requirements too demanding, especially given its relatively small size,

became more interested once the semiconductor industry’s revenues exceeded $50

billion in 1990 and annual capital spending exceeded $10 billion. 

Comparing the structure of the MCS industry between 1990 and 1996, the

following changes are evident. As of 1996,118 companies out of the total of 191 had

semiconductor-related sales under $8 million; of this total only 45 companies or 38%

were identified as supplying the semiconductor industry in 1990. Of the 73 companies

with metrology-related revenues $8 million and larger, 52 were identified as having

sales to the semiconductor industry in 1990. We can also review changes in the MCS

industry by technology segment: 48% of analysis/measurement entities “overlapped”

(i.e. 48% of the analysis measurement entities identified for 1996 were also identified

as suppliers in 1990), 35% of the gas/water/chemical metrology suppliers overlapped,

42% of the inspection equipment supplying entities overlapped, and 51% of the

measurement entities overlapped. That gas/water/chemical metrology-capability

suppliers show the greatest degree of new entrants is not surprising based on the

changes in the semiconductor customer base and technology. We discuss this point

further in the following section.

Excluding process tool companies, comparing the average company metrologyrelated revenues to the semiconductor industry, 1996 versus 1990, indicates that

average company revenues remained relatively small: $7.3 million in 1996 versus $3.4
28

million in 1990 ($5.4 million for companies who also had sales in 1996).33 Since a

number of companies identified as metrology capable suppliers also sell to other endmarkets, this measure does not reflect the average size of the total corporate entity.

B. Determining the Size of the U.S.-Based MCS Industry – Demand Side

This section determines the size of the U.S.-based MCS industry using a

demand-side methodology. We first review trends in each of the four metrology-related

cost centers and then aggregate the amount of metrology spending estimated for each

cost center to arrive at an industry total.

Cost Center 1: Wafer Manufacturing Facilities

Metrology costs related to wafer fabrication facilities occur during two stages: 

facilities construction and facilities operation. Measurements at these two stages

involve very different types of activities. Metrology-related activities during facilities

design and construction (excluding consumables delivery systems) are relatively minor,

although they tend to scale as facilities’ costs increase. These activities generally relate

to validation of the structure or clean room specifications during construction and final

acceptance. Metrology activities during operation are more varied. In the late 1980's

when a one-micron capable facility was considered to be a leading edge facility,

metrology measurements were based on sampling the major metrology activities

 

33 We excluded process tool companies because these tend to be significantly larger in scale, on

average, than the average size of the non-process tool supplier.
29

related to measuring particulates in clean rooms with portable counters and relative

humidity with instruments. Today, the trend is towards embedded, in-line process

control with constant monitoring. 

The following summarizes current measurement activities related to wafer fabs: 

$ During construction and certification of clean rooms, a series of measurements

are required including: (i) airborne particle count (to certify the finished room); (ii)

floor vibration, especially with respect to stepper placement, to see if the floor

meets the stepper manufacturer’s vibration requirements34; (iii) room noise, if

specified (requires a sensor costing $4K); and (iv) yellow light spectrum, to

ensure that lights in the photolithography areas do not emit any portion of the

spectrum harmful to the process, namely the shorter wavelengths.

Effluent monitoring has become more important, especially since 1992 due to

changes in federal and state regulations, but its costs are still relatively minor. 

However, with each location applying different rules and regulations for the

discharge into the water and air, monitoring costs vary significantly by location. 

In Texas, for example, eight years ago fab construction engineers were just

starting to think about effluent issues, whereas, in Silicon Valley there was

already a major concern about the discharge of organic chemicals. Typically

semiconductor firms bear testing costs to validate that a new facility meets

federal, state and local discharge regulations at the time a facility is certified. 

Outside firms qualify the facility. There usually is no requirement to periodically

re-qualify. U.S. standards are now becoming the de facto world standards since

the U.S. is usually considered to have the most stringent regulations and

enforcement.

$ Once certified, the clean room requires the following metrology equipment to

monitor particulates and general cleanliness:

 

 

34 Vibration is principally an issue at the time of equipment installation. Vibration sensitivity

specifications typically are provided by the equipment supplier. This is a relatively simple measurement to

verify. The actual cost to certify vibration requires a measurement instrument costing between $5K to

$10K. The criteria associated with measuring structural and mechanical vibration for structures is in

dispute. See K. Medearis, ARational Vibration and Structural Dynamics Evaluations for Advanced

Technology Facilities,@ Journal of the Institute of Environmental Studies, September/October, 1995.
30

S an airborne particle counter capable of detecting at least 0.10 micron

minimum particles with a flow rate of at least 1 CFM, with attachments to

the counter to scan filter faces for leaks;

S air velocity measuring equipment capable of reading accurately down to

30 - 40 FPM to monitor vertical laminar flow and other air flows;

S an accurate air temperature and humidity measuring system to verify the

HVAC operation35;

S a low-pressure gauge to monitor internal pressure in the clean room;

S a deep ultra-violet photolithography chemical system sensitive to certain

airborne contaminants;

S a system to measure ionization levels or static charge; and,

S safety-related monitoring including fire and toxic gas monitoring.

Certain other measurements are taken off-line, for example, electrostatic

discharge.

Metrology used in monitoring systems to control factors such as humidity or air

flow is not directly measuring parameters related to wafers being fabricated in the

facility. Clean room parameters are monitored via a control system costing between $4

million and $5 million per installation that monitor chilled water delivery, air handling,

dew point, steam injection, and auto dampers for pressure. By comparison, for a fab of

the late 1980’s, control unit costs would have ranged between $2.5 million and $3

million per installation. An important factor driving the 80% increase in cost per

monitoring unit is the need to increase the number of monitoring (or detection) points. 

 

 

35 While specifications for temperature and humidity have tightened, the cost of monitoring has

remained relatively small because process steps that are sensitive to temperature and humidity are

enclosed in special chambers. 
31

This increase was not driven, per se, by tighter specifications in the fab design or tighter

process specifications. Rather the increase was a result of adding more controls with

more process driven systems. For example, regulations implemented in the early

1990’s relating to exhaust abatement necessitated greater control over effluents. In

addition, as total fab costs (structure plus clean room plus installed equipment) reach

$2 billion to $3 billion there is need for redundancy in the systems to ensure continuous

operation of the facility. Because control costs are a very minor cost element, it pays to

gain redundancy in controller systems to ensure that the systems are robust.

With five to eight fabs constructed in the U.S. in 1996, the total amount invested

in monitoring control systems just for new fabs ranged between $20 million and $40

million. Spending on replacement and upgrades for existing fabs is a multiple of the

spending on new fabs. The best estimates we obtained from the individuals we

interviewed suggested a range of $50 million to $150 million for 1996. In total,

therefore, metrology costs for U.S. wafer fab facilities in 1996 were estimated to be in

the range of $70 million to $190 million. Spending in 1990 for facilities metrology

equipment was estimated to be in the range of $30 million to $90 million.

Cost Center 2: Semiconductor Equipment Manufacturing

There are three categories of metrology-related costs for physical measurement

incurred by semiconductor equipment manufacturers: (1) metrology-related costs

incurred during new tool development (including the costs associated with using the
32

services of analytical labs); (2) metrology-related costs incurred during tool

manufacturing; and (3) metrology-related costs embedded in the tool.36

Tool Development Metrology Costs

Metrology-related costs incurred during tool development as a proportion of total

R&D costs vary significantly over the development cycle. These costs also vary by the

type of semiconductor equipment manufacturer. We obtained data on metrology costs

incurred in semiconductor equipment development from a survey of 28 U.S.-

headquartered semiconductor equipment manufacturers.37 Companies were asked to

provide data on R&D as a percent of sales in three periods, 1990, 1996, and projected

to 2000, as well as the percent of R&D costs related to metrology. See Table 3.

Table 3

% of Total R&D Metrology-Related Costs for

U.S. Semiconductor Equipment Companies

Period Average % of Total R&D Related to Metrology

1990 under 5%

1996 8%

2000 Over 10%

Source: Author’s survey of semiconductor equipment companies, 1997.

 

36 There are other metrology-related costs that we do not measure. For example, when a new tool

is first installed in a fabrication clean room there can be various measurements made.

 

37 We sent a survey to 120 U.S.-headquartered semiconductor equipment firms. Approximately

40 firms responded. The respondents accounted for about 80 percent of the total U.S. equipment industry

revenues in 1996. This survey was conducted for a different sponsor.
33

Tool Manufacturing Metrology Costs

In semiconductor equipment manufacturing, for major tool categories, the capital

costs to acquire metrology instruments and tools required to support manufacturing, as

a percent of equipment company total revenues, are estimated to run around 10% in

1996. If metrology capital costs are amortized over the life of the associated process

tools, the depreciation expense ranges between 5% and 7% of total revenues.

If metrology costs are compared to the semiconductor equipment

industry’s cost of goods sold, metrology costs represent about 10% of the

total manufacturing cost of goods sold, including depreciation costs. 

Looking ahead, as the semiconductor equipment industry introduces 300mm capable

tools, there will be another spike in metrology costs. 

Embedded Metrology Costs

The third area of metrology costs related to process equipment is metrology

capabilities embedded in process tools. For example, the typical semiconductor resist

processing tool requires nine different types of embedded measurements plus off-line

measurements as well. (See Table 1 and Table A.1 which summarize the metrology

attributes required by each major tool category.) It was very difficult to obtain data on

the amount of costs associated with these embedded metrology capabilities. No

equipment company keeps records in a manner that would permit it to readily determine

its embedded metrology costs. Instead of direct cost data, we have to rely on the

opinions provided by several interviewees. Their best estimates indicated that these

costs for embedded metrology capability typically run in the 3% to 7% range (expressed

as a percent of the total tool price). It was generally believed that these percentages
34

have remained relatively constant over the past five years. Interviewees noted that few

customers directly value metrology capabilities and, therefore, would resist increased

tool prices to pay for additional metrology capabilities. Further, because costs for

embedded metrology-related components are relatively minor relative to other

component costs, few tool companies track these costs explicitly. Excluding the

potential impact of a move to employ tool-based sensors (mentioned in the

introduction), embedded metrology component costs are not expected to increase as a

percent of total tool cost.

Total Semiconductor Equipment-Related Metrology Costs

Table 4 tabulates metrology costs related to semiconductor equipment.38

Metrology costs in the semiconductor equipment segment increased at a rate of 29.2%

per annum (CAGR), exceeding the rate of increase in total wafer process equipment

revenues, worldwide, of 27% in the same period; the higher rate of growth reflects the

increased metrology costs associated with new tool development. See Table 4. 

Approximately 90% of total metrology costs in the semiconductor equipment cost center

relate to metrology costs incurred in tool manufacturing and embedded metrology costs.

Based on this analysis, it becomes evident why metrology costs increased in the 1990

to 1996 time frame at nearly the same degree as semiconductor wafer fab equipment

revenues since the wafer fab equipment metrology cost center end-use accounts for

roughly two-thirds of total metrology equipment, instruments, and sub-systems.

 

38 As with the supply-side estimate, these estimates are for total purchases of metrology capability, 

regardless of source.
35

Table 4

Metrology Costs in the Semiconductor Equipment Industry

(Excludes Process Metrology, Test & Assembly Equipment)

($ Millions, except were noted otherwise)

Category 1990 1996 2001Projected

1. Estimated U.S. Base

Wafer Process Equipment

(see note 1)

2,250 9,400 19,000

Compound Annual Growth Rate 26.9% 15.1%

Semiconductor Equipment Manufacturers’ Metrology Costs

2. Metrology-related costs in R&D 15 90 230

3. Metrology-related costs for tool 

 manufacturing

115 – 160 470 – 660 950 – 1,330

4. Cost related to embedded metrology

 capability in tools

70 - 160 280 – 660 570 – 1,330

Total (Lines 2 – 4) 190 - 335 840 – 1,410 1,750 – 2,890

Average Compound Annual Growth Rate 27.5% 15.6%

Note 1: Sources include VLSI 1990; Paine Webber 1995 data adjusted by worldwide growth rate of 14% to 1996

level; and DATAQUEST, Dec. 1997 forecast. 
36

 Cost Center 3: Consumables Delivery Systems39

We apply a definition used in the semiconductor industry in defining metrology

costs related to consumable delivery systems to be covered by this study, namely we

include measurement costs at a wafer fab facility that occur inside the Abattery limit.@

The battery limit defines the boundary of responsibility between a consumables supplier

and a semiconductor device company customer with the supplier responsible for

product quality up to the battery limit. In practical terms, by applying this definition we

have excluded all upstream consumable supplier metrology costs. 

Since 1990, there has been a shift in the relative measurement activities and

responsibilities between the supplier and the customer. Customers support point-ofuse facilities – called Chemical Delivery Units or Modules (ACDUs@ or ACDMs@) -- on site

at the wafer fab with the suppliers bearing responsibility outside the battery limit. CDU’s

are located outside the wafer fab structure but still close enough to avoid a long run to

the fab and are segregated into separate bays for safety. 

As quality specifications tightened, inside the battery limit metrology costs related

to monitoring consumables have risen. Because the semiconductor industry has never

been able to validate an absolute value for different types of impurities, the industry

simply goes to the limits of detectability. This philosophy is driven by the simple

 

 

39 In addition to information provided in interviews, information in this section is also gathered from the

following sources: (1) ABulk Chemical Delivery: Does It Impact Yield?@ Semiconductor International, July

1994, pp. 108 - 114; (2) AChemical Distribution Systems Take the High Road,@ Semiconductor

International, July 1991, pp. 58 - 62; and (3) AAssessing the Design and Performance of a Central Hot

Ultrapure Water System,@ Microcontamination, February 1993, pp. 2 - 64.
37

economics that with instrumentation costs relatively minor, it pays the fab manager to

purchase the best instruments, regardless of the true benefits obtained.

AWe are driven by our customer B the fab operations group B wanting to

have major systems free of problems because $200K or $500K, [the cost

of monitoring], is a small cost for uncertain benefits B they like to rule out

issues.@ 

Complicating the assessment of consumables-related metrology costs is the fact

that certain of these measurements really take place in analytical labs and the rising

costs for consumables quality control measurements gets reflected in the rising costs at

the analytical labs. For example, a fab must periodically perform a trace metals

analysis. In the late 1980s, this measurement might have been done once per month

at a relatively minor cost of around $25K annually. Now the analysis is done almost

weekly with more expensive equipment. Typical costs for the analysis today are around

$400K per year per fab site.

Here are other illustrations of changes in consumable delivery system monitoring

costs:

$ De-ionized (“DI”) water systems include analytical instruments used to control

and monitor the DI water distribution system. These instruments include Total

Oxidizable Carbon (ATOC@) monitors, particles, resistivity, silica, and sodium. 

Costs for DI monitoring approximately doubled in cost between the late 1980s

and currently. With between five to eight fabs constructed in the U.S. in 1996,

the total amount invested in de-ionized water system monitoring would run

around $2 million to $3.2 million, per year.

S Costs were sensitive to the move from 1 micron to 0.5 micron

manufacturing. Instrumentation requirements changed due to the need

for increased sensitivity to achieve more accurate detection limits. The 1

micron fab cost for instrumentation was $100K around 1990; now the

investment per fab would typically run in the range of $250K to $1,000K,

with $400K the average. The average cost is expected to increase to

around $500K to $750K with the next generation of fabs.
38

S There are no barriers in the measurement area to move into sub-micron

manufacturing, though these monitoring costs would be expected to

increase by 2X or more from current cost levels.

$ Bulk gas monitoring focuses on hydrocarbon levels in oxygen and nitrogen tanks.

 Moisture is not always measured (some companies do it, others do not). This is

a one-time test at the time a new system is brought on line. Main trunk lines to

fab are verified with off-line testing. Typically inside the barrier there is no testing

of the bulk gas lines for particulates; this is the responsibility of the supplier.

S On-line measurement costs for bulk gas delivery are relatively minor,

costing $70K for system in 1990 and currently $90K. Cost is more a

function of the size of the system (number of tanks monitored).

$ Other delivery systems involve relatively minor costs. Specialty gases are

corrosive so typically once a specialty gas line is installed they clean well and do

not require continuous monitoring. Liquid chemicals require a relatively minor

amount of monitoring for particulates. Currently, this is an outside the barrier

responsibility of the suppliers who certify each delivery’s purity levels.

$ Chemical Mechanical Polishing (ACMP@) has led to a major new set of

requirements for monitoring. These tools require a slurry dispenser station that

uses a monitoring instrument costing around $50K to $70K. Slurry effluents will

also require monitoring in the future as new, non-benign slurries are utilized. 

Metrology costs associated with all phases of consumable delivery systems

inside the barrier, both for new facilities and upgrades, for 1996 are estimated to range

between $100 million and $300 million.

Cost Center 4: Analytical Labs

Analytical labs associated with the semiconductor industry can be divided into

captive and independent labs. There are an estimated 100 independent organizations

that perform analytical lab functions for the semiconductor industry, but the vast

majority of these independent labs perform tests as a secondary activity and many

perform only very specialized tests. In some instances, semiconductor equipment
39

companies perform specific measurements to characterize their equipment. Of the 100

firms, three of the largest firms that are dedicated to providing analytical lab services

are Balazs Analytical Laboratory, Charles Evans & Associates, and Surface Science

Laboratories.

In-house analytical labs come in a variety of forms.40 Some analytical labs are

stand-alone, others are part of either an R&D lab or an R&D prototype line. In the

semiconductor industry an increasingly popular concept is the Afab lab,@ an analytical

lab co-located with a clean room, frequently with one window looking into the clean

room. Fab labs are most common with the largest semiconductor makers at their

larger, full-volume manufacturing sites. Tools typically procured for the fab lab include

the following: SEM equipped with energy dispersive spectroscopy (EDS), focused ion

beam systems (FIB), whole wafer Auger microscopes, whole wafer time of flight (ToF),

secondary ion mass spectrometry (SIMS), dynamic SIMS, atomic force microscopy

(AFM), total reflection x-ray fluorescence (TSRF), transmission electron microscopy

(TEM), ellipsometers, x-ray fluorescence (XRF) equipment, and fourier transform

infrared (FT-IR) spectrometers.

In 1996, the total semiconductor-related sales of the three independent analytical

labs totaled approximately $20 million. Discussions with experts suggest that the total

analytical lab revenues associated with the supply of services to the semiconductor

industry would likely range in the $50 million to $100 million range. If correct, then

 

 

40 The discussion in this section is based, in part, on A. Diebold and R. McDonald, AThe At-Line

Characterization Laboratory of the 90s.@ Future Fab International, 1997.
40

independent analytical lab procurement of metrology equipment and instruments

allocated to support the semiconductor industry would range between $5 million and

$15 million.

Turning to the in-house labs, according to one estimate, the typical fab lab

installation costs between $10 million and $15 million to equip.41 By comparison, a fab

lab, vintage 1990, would have cost approximately $2 million to fully equip. With

between 5 and 8 new fabs constructed in 1996, this suggests total new fab lab

equipment costs in the range of $50 million to $120 million. Additions and upgrades to

existing fab labs would likely double this figure, suggesting that in-house procurement

of metrology equipment is significantly greater than independent analytical operations. 

(These costs exclude the cost of the clean room space.) We estimate that total

spending for in-house analytical lab equipment, including new installations, probably is

between $100 million and $300 million.

 

41 Diebold and McDonald.
41

C. Demand Side Estimate

Table 5 summarizes the results of the demand side analysis. 

Estimated 1990 total metrology-related spending by the four cost centers

ranged between $330 million and $625 million. The 1996 metrology-related

spending was estimated to range between $1,165 million and $2,265

million. The implied rate of growth between 1990 and 1996 for total

metrology-related spending was 24.4% (using the mid-point of the 1990 and

1996 ranges). Semiconductor equipment accounted for nearly two-thirds

of total metrology costs in 1996. The growth of metrology costs in this

segment closely tracked the growth of size of the total wafer fab equipment

market.

That semiconductor equipment growth drives MCS industry growth is not surprising

since a substantial portion of metrology cost is incurred in semiconductor equipment

manufacturing and is also embedded in final wafer process tools. The fastest growing

metrology cost segment is analytical labs. This fact probably reflects the rapid

expansion of in-house labs, especially fab labs.
42

Table 5

Demand-Side Estimate of Total U.S. Metrology-Related Costs

($ Million, except where noted otherwise)

Metrology End-Use Segment 1990 Range 1996 Range

% of Total

Spending

(1996)

Compound Annual

Growth Rate

(on median of range)

Wafer Fab 45 90 70 190 7.6% 11%

Semiconductor Equipment,

(Note 1) 190 335 840 1,410 65.6% 27%

Consumables Delivery Systems 75 150 150 350 14.6% 14%

Analytical Labs 20 50 105 315 12.2% 35%

Total U.S.

Metrology-Related Costs 330 625 1,165 2,265 100% 24.4%

Note 1: Includes metrology-related costs embedded in final equipment plus metrology-related costs in R&D and

manufacturing.

D. Size of the Metrology Infrastructure in 2001

On a global basis, the semiconductor industry is projected by DATAQUEST, a

market research firm that follows the semiconductor industry, to grow at a CAGR of

16.2% between 1996 and 2001. DATAQUEST also projects semiconductor-related
43

capital spending to increase at a CAGR of 13.3% and wafer fab-related capital

equipment sales to increase at a CAGR of 15.5%.42 The World Semiconductor Trade

Statistics program projects the U.S. semiconductor market to grow at a CAGR of 17.7%

between 1996 and 2000. 

Historically, metrology-related spending growth has followed the general trend of

semiconductor industry capital spending and, in particular, wafer fabrication equipment

revenues. The close link to the growth in wafer fab revenues is explained by the fact

that over 60% of metrology-capability equipment is consumed by the wafer fab

equipment end market. As indicated in Table 6, metrology costs in the semiconductor

equipment cost center are projected to rise by 15.5% CAGR between 1996 and 2001

based on the DATAQUEST forecast for the wafer fab end market.

Assuming metrology costs in the other cost centers growth at roughly the

same rate, the total size of the metrology infrastructure would increase to

between $5.2 billion and $5.9 billion by 2001, based on the supply side

definition of the total U.S. base of metrology spending. Using the mid-point

of this range, the size of U.S. metrology infrastructure should reach $5.5

billion by 2001.

 

42 DATAQUEST as cited in Channel, January 1998, page 7.
44

IV. Summary

We can compare the results obtained from the supply side evaluation to the

results from applying the demand side method. In making this comparison it is

important to understand that the two methods were applied to different definitions for

the semiconductor industry. The supply side approach covers metrology-related sales

for the entire semiconductor industry, not just the four cost intensive segments. We

determined sales data for U.S.-based MCS companies and then added sales by

foreign-headquartered companies to arrive at a total. The demand side approach

covers just the four metrology-intensive segments and implicitly includes U.S.-source as

well as foreign-source metrology hardware. Given these differences, the most

appropriate level to make the comparison would be the supply side total, U.S.-based

MCS industry plus foreign-headquartered company sales in the U.S. market, to the total

demand side result. Because the former approach covers the entire semiconductor

market, we expect the supply side result to be greater than the demand side one. 

Table 6 summarizes the overall results from the two methods and provides a

comparison of the metrology spending levels and growth to those for the world

semiconductor industry and semiconductor equipment industry.
45

Table 6

Comparison of Trends in Estimated Total Metrology-Related Costs to

World Semiconductor Industry Revenues, 1990, 1996 and 2001

($ Million, except where noted otherwise)

1990 1996 CAGR

%

Segment

Low High Low High

2001 1990

to

1996

1996

to

2001

Supply-Side Estimate

(includes non-U.S. sources)

($Million)

Total U.S. Metrology-Related

Costs (Note 1) 750 2,525 2,845 5,500 25.2% 15.5%

Demand-Side Estimate

($ Million)

U.S. Metrology Costs

(total all end-use segments) 330 625 1,165 2,265 3,500 24.4% 15.5%

World Semiconductor Industry

($ Billion)

Revenues (Note 2) 50.5 129.2 270.0 17.0% 16.2%

Capital Expenditures (Note 3) 13.8 45.0 84.0 21.8% 13.3%

Wafer Fab Equipment

Expenditures (Note 4)

5.7 21.7 44.5 25.0% 15.5%

Notes:

(1) Includes foreign-headquartered metrology suppliers’ U.S. sales.

(2) Semiconductor Industry Association

(3) DATAQUEST, December 1997 (Channel, January 1998, page 7.)

(4) DATAQUEST and Paine Webber. Includes metrology process tool revenues.
46

We conclude by commenting about the accuracy of our estimates for the size of

the U.S. metrology infrastructure. 

Both the supply side and demand side estimates yielded consistent results for

the rate of growth of the metrology infrastructure. Where the results are less certain is

the industry’s size. This should not be surprising given the difficulties we encountered,

explained at length in Section II, in defining the metrology infrastructure. Both the

supply side and the demand side methods yielded a fairly wide estimated range for the

size of the metrology infrastructure. For 1996, the ratio of the maximum to the

minimum estimated size was nearly 2X for the supply side method and 1.5X for the

demand side. However, the supply side and demand side ranges do not overlap. Our

interpretation of this result is that the best estimate for the industry’s size in 1996 is a

range constructed from the high end of the demand side estimate and the low end of

the supply estimate. We believe our approach is reasonable for the following reason.

The supply-side method overstates semiconductor industry metrology costs because it

requires the estimation of both non-metrology sales of U.S. metrology suppliers and the

division between U.S. and non-U.S. sales. On the other hand, we concluded that the

demand-side method understates total metrology costs because it relies mainly on

experts’ estimates of metrology costs for certain end-use segments. This meant that it

was more prone to underestimation due to differing definitions and incomplete

knowledge about the true extent of metrology spending in the semiconductor industry. 
47

We believe the most reliable estimate for the metrology infrastructure’s

size would be between $625 million $750 million in 1990, between $2.3

billion and $2.5 billion in 1996, with expected growth to between $3.5 billion

and $5.5 billion by 2001.





Appendix A

Measurement-Related Attributes
Appendix A

Measurement-Related Attributes

C Temperature: Absolute temperature and temperature gradients are important

parameters in both machine condition and processing and processed material

condition that need to be controlled. Also important is temperature rate of

change. The concept of thermal budget refers to the integrated timetemperature a wafer has spent in order to control the redistribution of dopants in

the device structures.

C Physical Dimensions: Physical dimension attributes cover device structure

dimensions including layer thickness, line widths, positions of features, including

overlay. Wafer position and orientation may fall in this category, with some

overlap with the Handling attributes. Other physical dimensions that need to be

considered and monitored could include machine state dimensions where wear

is an issue -- thickness of sputtering targets as an example. Weights, where

they are monitored, would be in this category.

C Pressure: Total and partial pressure of gases and perhaps liquids, partial

pressures of gases in reduced atmosphere and vacuum environments, are

important parameters that need to be monitored and controlled.

C ADose:@ This refers to the amount of dopants or radiation that are deposited on

the material being processed. Radiometric measurements overlap somewhat

with the next attributes category in my mind.

C Optical Properties: The intensity, polarization, spectral distribution, line width,

band width, time dependence, coherence, are all possible parameters in this

category. 

C Flow Rates: This category includes not only gases and liquids used for

processing the materials, but also where liquids or gases are used for heat

transport, such as constant temperature wafer stages. Flow rates may be

measured as mass flow rates or as volume flow rates.
C Contamination: Particulate sizes, positions, size distributions, and composition

on wafers being processed, and in processing environments are monitored and

controlled. Chemical contamination of processing gases and liquids, and

chemical contamination of surfaces of processing chambers and wafer handling

equipment and wafer carriers need to be monitored. Resistivity, pH, total

oxidizable etc., are monitored in processing fluids such as de-ionized water and

isopropyl alcohol.

C RF Power: Frequency, phase, power levels, both incident and reflected, come

to mind for this category.

C Handling: This category refers to machine state; where are the wafers,

conditions of valve settings, chamber doors, are relevant parameters. There is

some overlap with the Physical Dimension attributes. 

C Effluents: Liquid and gaseous emissions downstream from processing steps are

monitored for environmental reasons and also perhaps for end point detection.

C Time: Processing time can be monitored to control other parameters. Time of

day and date are used in data logging.

C Magnetic Field: Magnetic field strength and shape/orientation are important

parameters, especially in plasma processing and ion implantation.

C End-Point Detection: End-point of processing steps is commonly monitored by

a variety of means. These can be changes in the reacting gases or fluids,

changes in the plasma, or direct observations of the processed material, usually

optically.

C Chemical Composition: The compositions of reactants and formed materials

on the processed material are commonly monitored. Liquid bath compositions

are monitored to determine when the bath needs attention. I assume de-ionized

water measurements are included under the Contamination attributes.

C Stress and Strain: This attribute is monitored in layers formed in and on the

processed material, as well as in the packaging structures.

C In-line Electrical Test (resistivity): This attribute is measured in-line by process

equipment.
Table A.1

Measurement-Related Capabilities by Category of Wafer Processing Equipment

Measurement Attribute

Resist

Processing

Equipment

Optical

Exposure

Systems

Direct

Exposure

Systems

Mask

Exposure

Systems

CMP Ion

Implanters CVD Diffusion

Oxydation

1. temperature

 gradient & absolute

2. physical dimensions

 thickness / weight / position

3. pressure

 total / partial

4. Adose@

 radiometry flux

5. optical properties

 intensity polarization

 spectral distribution / bandwith

6. flow rates

deposited

volume

7. contamination

 particulates (size / distribution)

 gas phase

8. Rf power

9. handling

10. effluents

11. time

 interval

12. magnetic field

 measurements

13. end-point distribution

 emission / coherence

 shift composition

Not currently

– but would

like

14. chemical composition

 liquid & solid (excluding gases)

Off-line Off-line

15. stress & strain Off-line Off-line

16. in-line electrical test

 resistivity

Off-line Off-line
Table A.1

Measurement-Related Capabilities by Category of Wafer Processing Equipment (continued)

Measurement Attribute RTP Dry Etch Dry Strip Wet Wafer

Processing

Automated

Handling

Systems

Effluent

Management

Systems

Sputtering

PVD Electroplating

1. temperature

 gradient & absolute

2. physical dimensions

 thickness / weight / position

3. pressure

 total / partial

Not yet

important

4. Adose@

 radiometry flux

5. optical properties

 intensity polarization

 spectral distribution / bandwith

6. flow rates

7. contamination

 particulates (size / distribution)

 gas phase

8. Rf power

9. handling

10. effluents

11. time

 interval

12. magnetic field

 measurements

13. end-point distribution

 emission / coherence

 shift composition

Trying to

obtain

capability

14. chemical composition

 liquid & solid (excluding gases)

Off-line

15. stress & strain Off-line

16. in-line electrical test

 resistivity
Appendix B

List of Segments
Metrology-Related Segments Used to Define

Metrology Capabilities Suppliers

--------------------------------------------------------------------------

These segments cover both metrology products and metrology applications.

1. Analysis / Measurement

a. defect detection

b. film thickness

C. microscopes

d. SEM

e. SIMS

f. surface inspection / flatness

9. X-ray

2. Assembly / Hybrid

a. inspection

3. Clean Room

a. monitoring systems

4. Process Chemicals

a. control handling

b. monitoring equipment

5. Inspection Equipment

6. Process Equipment

a. measurement equipment

b. in-line inspection

7. Process Gases

a. analysis standards

b. control handling

C. monitoring equipment

8. Services

a. measurement / inspection

9. Test

a. failure analysis

b. temperature / environment / pressure
Appendix C

Individuals Interviewed
List of Interviewees

1. John Fehr, Motorola (abatement)

2. Pat Gabella, SEMI/SEMATECH

3. Mike McGraw, SEMI/SEMATECH

4. David Jensen, SEMATECH

5. Alain Diebold, SEMATECH (analytical labs)

6. Fred Streiter, formerly with Texas Instruments (clean room)

7. David Perloff, (Voyan Technology (measurement instruments)

8. Jeff Bindell, Lucent (analytical labs)

9. Fred Norton, AMD (bulk chemical & gas delivery)

10. Ana David, Union Carbide (bulk & specialty gas delivery)

11. Bob Bachrach, Applied Materials (process tools)

12. Henry Moore, Hewlett-Packard (clean room monitoring)

13. Mike Gordon, Texas Instruments (gases, di-ionized water)

14. Tom Shaffner, Texas Instruments (analytical labs)

15. Anonymous (chemical delivery systems; CMP slurry)

16. Ed Millis, consultant (clean room monitoring)

17. Anonymous (photolithography)

18. Ken Medearis, consultant (vibration measurement for structures)

19. Carl White, Motorola (vibration measurement)

20. Jose Frausto, Motorola (fluid flow monitoring)

21. Jim Intrater, Oryx Technologies (electro-static discharge measurement)
Appendix D

Example of Questionnaire Used in Interviews
Estimating MetroIogy-Related Costs

For Electroplating Equipment

This study is conducted under the sponsorship of

the National Institute of Standards and Technology ("NIST") for the purposes

of assisting in developing background information for application

in the Semiconductor Technology Roadmap

Objective

This study is being carried out under the sponsorship of the NIST. NIST is seeking to quantify the dollar

amount of metrology-related investments made by the semiconductor industry in total and by major category

for the years 1990, 1995 and 2000.

What We Need From You

You have been identified as an expert on a particular technical area we are seeking information on. We need

you to provide us with your best estimate for % of metrology-related costs embedded in the total value

semiconductor equipment system you are an expert on. Please note that we have structured the information

collection process to ensure that we are not seeking to obtain company sensitive data.

This questionnaire seeks information related to metrology-related costs embedded in Electroplating equipment.

We need you to estimate the % of total Electroplating system equipment value (i.e., cost to the end-customer)

related to providing the metrology capabilities we define on the following page. These metrology capabilities

relate to both monitoring and controlling tool functions as well as monitoring product quality. After reviewing the

following list of measurement attributes of Electroplating TOOLS, please complete TABLE A and fax or mail

it to:

William F. Finan

Technecon Analytic Research

2445 M Street, N.W. Suite 200

Washington, D.C. 20037

Tel: 202-974-4663

Fax: 202-296-4008
Metrology attributes of Electroplating Equipment that we want you base you response in Table <A> on. That is,

in providing your estimate for metrology-related costs embedded in an Electroplating system, we have

identified that a typical Electroplating tool requires the following measurement capabilities:

Temperature: Absolute temperature and temperature gradients are important parameters in both machine condition and processing

and processed material condition that need to be controlled. Also important is temperature rate of change. The concept of thermal

budget refers to the integrated time-temperature a wafer has spent in order to control the redistribution of dopants in the device

structures.

Physical Dimensions: Physical dimension attributes cover device structure dimensions including layer thicknesses, line widths, film

thickness, positions of features, including overlay. Wafer position and orientation may fall into this category, with some overlap with the

Handling attributes. Other physical dimensions that need to be considered and monitored could include machine state dimensions

where wear is an issue -- thickness of sputtering targets as an example. Weights, where they are monitored, would be in this category.

Pressure: Total and partial pressure of gases and perhaps liquids, partial pressures of gases in reduced atmosphere and vacuum

environments, that need to be monitored and controlled. NOT YET IMPORTANT.

Contamination: Particulate sizes, positions, size distributions, and composition on wafers being processed, and in processing

environments are monitored and controlled. Chemical contamination of processing gases and liquids, and chemical contamination of

surfaces of processing chambers and wafer handling equipment and wafer carriers need to be monitored. Resistivity, pH, total

oxidizables etc., are monitored in processing fluids such as de-ionized water and isopropyl alcohol,

Contamination: Particulate sizes, positions, size distributions, and composition on wafers being processed, and in processing

environments are monitored and controlled. Chemical contamination of processing gases and liquids, and chemical contamination of

surfaces of processing chambers and wafer handling equipment and wafer carriers need to be monitored. Resistivity, pH, total

oxidizables etc., are monitored in processing fluids such as de-ionized water and isopropyl alcohol.

Time: Processing time can be monitored to control other parameters. [Note: some reviewers believe this category is no longer

applicable since events are monitored, not time per se.]

End-Point Detection: End-point of processing steps is commonly monitored by a variety of means. These can be changes in the

reacting gases or fluids, changes in the plasma, or direct observations of the processed material, usually optically. In this case it is the

total change in thickness being measured.
TABLE <A>

Electroplating Equipment

Please complete this table providing the % of total system cost related to

providing the measurement capabilities listed above for

Electroplating Equipment.

(Note: "System cost" is defined as the total value of the system as purchased by an end

customer, that is, estimate measurement costs as a % of the total end-value of the system to

the customer.)

Enter your estimate of embedded

measurement costs as a % of total "system

cost" for the period specified

LOW

estimate for measurement costs as % of

total system cost

HIGH

estimate for measurement costs as % of

total system cost

Year 1990

0.8F - 1.0F front end

Year 1995

0.5F front-end

Year 2000

0.35F or below

William F. Finan

Technecon Analytic Research

2445 M Street, N.W. Suite 200

Washington, D.C. 20037

Tel: 202-974-4663

Fax: 202-296-4008
Appendix E

List of Metrology Capability Supplier Companies

Available in hard copy only.