PALO ALTO, Calif. -- In a move to cut costs and enable new process technologies, Agilent Technologies Inc. here disclosed plans to consolidate its wafer fab operations into a new, advanced plant in Colorado. The company's new, 6-inch (150-mm) wafer fab in Fort Collins was originally announced last October.

In this new fab, Agilent is also quietly readying a new indium-phosphide (InP) process, which is said to provide more performance at lower power levels than silicon-germanium (SiGe) technology, according to the Palo Alto-based company.

The new InP technology is geared for high-performance, communications-oriented devices, said Bill Sullivan, who was recently named executive vice president and chief operating officer at Agilent. The company is the test, measurement and IC spin-off of Hewlett-Packard Co.

With InP technology, Agilent plans to develop "10-gigabit-per-second(Gbps) devices and 40-Gbps products for sure," said Sullivan in an interview with SBN at Agilent Laboratories in Palo Alto on Tuesday. Last month, Sullivan was named COO after heading up the company's Semiconductor Products Group as senior VP and general manager since August 1999 (see Feb. 27 story).

On Tuesday, Agilent held a one-day event for the press and analysts at Agilent Labs--the company's central and vast R&D arm. The event was intended to give a sneak preview of the company's new and future product directions and technologies.

During the event, Sullivan disclosed that the company plans to consolidate its exiting fab operation into Fort Collins. In a move to cut costs, the company has or will shut down three fabs in California, according to the Agilent executive.

The company has already closed an older bipolar fab in San Jose and transferred the technology into a plant owned by STMicroelectronics Inc. in Singapore, according to Agilent, which last last year announced two rounds of layoffs that would eliminate 8,000 jobs, or 18% of its total workforce, by the middle of 2002 (see Nov. 15 story).

Agilent also plans to close two separate fabs in Santa Clara and Fremont, Calif. The Santa Clara-based fab was an old, gallium-arsenide (GaAs) plant, while the newer Fremont-based operation manufactured wireless devices, based on the company's proprietary GaAs process, called E-pHEMT (enhancement-mode pseudomorphic high-electron-mobility transistor).

The company plans to move the technology at both of these plants into the Fort Collins site by the end of 2002, according to Sullivan. In Fort Collins, meanwhile, the company is also developing its InP technology, one of the new and emerging processes vying for dominance in the high-performance chip market.

The move represents somewhat of a new direction for Agilent. Previously, the company developed devices based on CMOS and traditional GaAs processes. "The ideal model is to do everything in CMOS," he said, noting that InP will serve the higher-end, wireline-chip space.

The company has no plans to develop SiGe technology, said Thomas Saponas, senior vice present and chief technology officer at Agilent. Instead, Agilent will utilize outside foundries for its SiGe requirements, Saponas said in an interview with SBN.

Besides, InP has several advantages over SiGe, declared James Hollenhorst, director of Electronics Research Laboratory at Agilent Labs. "There is no doubt that silicon-germanium will be important," Hollenhorst said. "But we believe InP is faster than silicon germanium," he said during a presentation.

Some SiGe providers will no doubt disagree, namely IBM Corp. In a move to show that silicon-based ICs will not be replaced by high-speed compound semiconductors in the future, IBM recently announced the world's fastest semiconductor circuit using its newest generation of silicon-germanium technology, dubbed "SiGe 8HP."

The SiGe circuit--a ring oscillator operating at speeds over 110 GHz and processing electrical signals at 4.3 trillionths of a second--proves that silicon-based technologies will continue to outperform other compound semiconductors, such as GaAs or InP, according to IBM (see Feb. 25 story).

Meanwhile, Agilent will use continue to silicon foundries for its CMOS-based parts. Agilent has a foundry partnership with Singapore's Chartered Semiconductor Manufacturing Pte. Ltd., but the U.S.-based company re-structured its previous arrangement to sell half of its 30% stake in a joint-venture 8-inch fab because it did not need the capacity. Under an agreement announced last fall, Agilent has the option to reacquire the 15% shares in Chartered's Fab 6 during a two-year period, which ends in October 2004 (see Oct. 22 story).