Exploring the Unknown - NASA's History Office

Return on Investment*—$M
50
40
30
20
10
Figure 15. Plant cost sensitivity (10 plants)
The sensitivity of rate of return on investment to integrated circuit processing yield
improvement is shown in Figure 16. As noted earlier, the integrated circuit processing cost
savings determine its allowable cost premium over ground processed material. The importance
of this parameter prompted an independent assessment of yield improvement from
the Integrated Circuit Engineering Corporation (ICE), a consulting firm to the industry.
For a composite market, with a ratio of MOS device sales to bipolar device sales of 3 to 1,
the processing yield for .38 cm x .38 cm baseline chips using space processed material is
expected to increase from 14% for ground material to 25% for space manufactured ribbon.
It should be noted that a yield increase of only 5% would result in a rate of return
on investment comparable to current industry operations.
[Figure 16 originally placed here]
[11] The sensitivity of return on investment to Shuttle user charge is shown in Figure 17.
The estimated Shuttle user charge of $21M per launch amounts to a cost of about
$840 per kg. This cost is a significant portion of the silicon ribbon manufacturing cost per
kg, so return on investment decreases rapidly with increased Shuttle user charge.
[Figure 17 originally placed here]
0
29.5%
[12] 6.0 RISK ASSESSMENT
EXPLORING THE UNKNOWN 509
* After Taxes
Estimated Cost $16M
(Excluding DDT&E)
0 10 20 30 40
Plant First Unit Cost—$M
To compare the 29.5% rate of return on investment for ten plants with a typical industry
return on investment of 10% requires that it be adjusted for risk. In industry this is usually
done by requiring a higher expected rate of return on investment for new projects
than that resulting from current operations. In our survey of four crystal manufacturers