IQE wins funding for Next Generation Broadband ...

IQE plc
("IQE" or the "Company")
19 May 2009

Cardiff, 19th May 2009: IQE, the leading global supplier of advanced
semiconductor wafer products and wafer services to the semiconductor
industry, is pleased to announce that it has won funding for research
into compound semiconductor laser products for the next generation of
high speed broadband access devices.

The funding comes from the Technology Strategy Board (TSB), which is
the organisation that drives technological innovation in the UK. The
TSB is investing £1 million to help companies carry out initial
research that will ultimately lead to the introduction of internet
access technology with speeds up to 10Gb/s which is 1,000 times
faster than current broadband speeds.

IQE and chip foundry partner CST Global have been collaborating on
development of high specification diode laser components for such
applications. The partners have been awarded three feasibility
studies in the programme in a parallel approach to look at low cost
laser sources for uncooled, high speed, extended reach Fibre To The
Home (FTTH) applications based on AlInGaAs laser products.

Project lead Dr Wyn Meredith commented:

"We are looking to solve the paradox of producing diode sources with
telecoms grade quality with consumer grade pricing for this last link
of access to the home. We are already seeing unprecedented growth in
InP based epitaxial products driven by FTTH deployment in Asia, and
we are preparing to address Next Generation network expansion with
high value add foundry products to enable our customers to react
quickly.

"This phase of optical network expansion is rewriting the rulebook in
terms of the cost - quality equation; we are enabling a new breed of
component vendors who have been quick to adopt the foundry model, and
are proving far more agile and resilient than their vertically
integrated competitors in the current market conditions. Involvement
in this programme will result in rapid introduction of standardised
foundry epitaxial and fabrication level laser diode solutions which
will have proven performance in terms of transmission speed and
optical power output, compatible with larger (4") wafer formats."


Contacts:

IQE plc ([phone])
Chris Meadows
Wyn Meredith



Note to Editors

About IQE
IQE is the leading global supplier of advanced semiconductor wafers
with products that cover a diverse range of applications, supported
by an innovative outsourced foundry services portfolio that allows
the Group to provide a 'one stop shop' for the wafer needs of the
world's leading semiconductor manufacturers.

IQE uses advanced crystal growth technology (epitaxy) to manufacture
and supply bespoke semiconductor wafers ('epi-wafers') to the major
chip manufacturing companies, who then use these wafers to make the
chips which form the key components of virtually all high technology
systems. IQE is unique in being able to supply wafers using all of
the leading crystal growth technology platforms.

IQE's products are found in many leading-edge consumer,
communication, computing and industrial applications, including a
complete range of wafer products for the wireless industry, such as
mobile handsets and wireless infrastructure, Wi-Fi, WiMAX, base
stations, GPS, and satellite communications; optical communications,
optical storage (CD, DVD), laser optical mouse, laser printers &
photocopiers, thermal imagers, leading-edge medical products,
barcode, high efficiency LEDs and a variety of advanced silicon based
systems.

The manufacturers of these chips are increasingly seeking to
outsource wafer production to specialist foundries such as IQE in
order to reduce overall wafer costs and accelerate time to market.

IQE also provides bespoke R&D services to deliver customised
materials for specific applications and offers specialist technical
staff to manufacture to specification either at its own facilities or
on the customer's own sites. The Group is also able to leverage its
global purchasing volumes to reduce the cost of raw materials. In
this way IQE's outsourced services, provide compelling benefits in
terms of flexibility and predictability of cost, thereby
significantly reducing operating risk.

IQE operates six manufacturing facilities located in Cardiff (two)
and Milton Keynes in the UK; in Bethlehem, Pennsylvania and Somerset,
New Jersey in the USA; and Singapore. The Group also has 11 sales
offices located in major economic centres worldwide.


About CSTG

CSTG is a 'pure play' semiconductor foundry specialising in the
design, development, and manufacture of discrete and integrated III-V
opto-electronic devices, based in Glasgow, UK.
Since 1999, CSTG has provided specialist foundry services to clients
in the Telecommunications, Defence, Medical and Instrumentation
markets.

We offer full product support from design to manufacturing, levered
off a comprehensive library of qualified fabrication processes and a
suite of high performance device platforms.
Today CSTG serves both fabless and vertically integrated customers in
UK, US, Europe and Japan, and is recognised as a flagship project for
the UK opto-electronics industry.


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