In Brief....(chip shortage in 2001)

Chips Will Still Be Short In 2001: The silicon shortage will extend through next year, say representatives of the smart card industry's largest silicon manufacturers, who warn buyers to expect tight supplies for many more months.

The chip makers, speaking at the recent Cartes 2000 convention in Paris, say new production capacity will not bring much relief in 2001. The shortage began about 18 months ago.

"At the moment, what makes me quite nervous, the forecasts keep increasing and increasing," said J?rgen Kuttruff, vice president of sales and marketing for the security and chip card ICs unit of Munich- based Infineon Technologies AG, of requests by card manufacturers. "It takes one to two years to build up new (production) fabs; you need good long-term forecasts."

Card makers, for their part, blame the silicon manufacturers for at times not following through with promises to supply chips.

"I think if you give us your commitment, and we trust in this, then we are in trouble," said Udo Flling, CEO of Orga Kartensysteme GmbH, speaking at the same session. "The whole industry gets commitments that are not fulfilled. I think that is something that has nothing to do with forecasts."

The problem has led at least two card manufacturers to cut large deals with silicon makers to lock in supplies. Puteaux, France-based Oberthur Card Systems last …