Market analyst iSuppli ranks ST No.1 MEMs supplier

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STMicroelectronics Rides the Crest of the Coming
Motion-Sensing Consumer Wave

Market analyst iSuppli ranks ST No.1 in consumer and portable applications of
motion-sensing chips:
•        games controllers and smart phones fuel massive 118% growth in 2008
•        ST jumps from No.4 to No.1 with revenues more than twice those of its closest competitor

Geneva, January 15, 2009 - Whether it is conducting a virtual symphony orchestra by waving a wireless baton, converting a dull physiotherapy exercise into an enjoyable interactive experience, or simply navigating through mobile phone menus by tilting the phone instead of pressing buttons, the motion-sensing technology known as MEMS (Micro-Electro-Mechanical Systems) is transforming the world of portable and consumer devices and STMicroelectronics (NYSE:STM) is leading this revolution.  According to market analyst iSuppli, ST’s sales of MEMS devices for portable and consumer devices, which are used in the Nintendo Wii, for freefall detection in PCs such as the Fujitsu Siemens ESPRIMO range, the Gyration Air Mouse, leading smart phones and many other new applications, surged from $96m in 2007 to more than $209m in 2008, a growth of 118% that makes ST the world’s number one supplier in this exciting and rapidly growing market.

“This is a dramatic confirmation of our vision a few years ago when we decided to commit resources to developing a new type of MEMS technology, one that could enable the creation of innovative and exciting consumer applications,” said Benedetto Vigna, Group Vice President and General Manager MEMS and Healthcare, RF and Sensor Product Division, STMicroelectronics. “Before 2006”, Vigna noted, “MEMS sensors were used in a few applications such as airbag collision sensors but were too bulky, too power-hungry and too expensive to be used in consumer applications.”

ST addressed the first two problems by innovative engineering, developing and patenting new MEMS structures that were smaller, more robust and required less electrical power to operate, while still delivering very high performance.  To solve the third problem, the Company took the bold step in 2006 of investing over $40m to set up the world’s most advanced MEMS production line.  The 200mm (8 inch) wafer processing facility in Agrate, near Milan, was inaugurated in November 2006 and is fully dedicated to producing MEMS devices such as accelerometers, gyroscopes and pressure sensors.

“Because semiconductor devices are processed in parallel on circular wafers of silicon, a 50% increase in the wafer diameter more than doubles the number of chips that can be manufactured at the same time and also significantly reduces the cost per device”, said Vigna. “Being the only MEMS manufacturer in the world with a 200mm production line meant we were able to assure our customers that we would be able to deliver accurate and reliable devices in the volumes and at the prices they needed to create exciting new consumer markets – and that is exactly what they have done.”

Following the enormous success of its MEMS accelerometers that measure linear motion, ST has expanded its portfolio to include tiny MEMS gyroscopes. These detect and measure tilt and angular motion, making them ideal for use in even more sophisticated game controllers, virtual reality transducers, motion controls, pointing devices, and vehicle navigation functions such as dead-reckoning and map-matching.

About STMicroelectronics
STMicroelectronics is a global leader in developing and delivering semiconductor solutions across the spectrum of microelectronics applications. An unrivalled combination of silicon and system expertise, manufacturing strength, Intellectual Property (IP) portfolio and strategic partners positions the Company at the forefront of System-on-Chip (SoC) technology and its products play a key role in enabling today's convergence markets. The Company's shares are traded on the New York Stock Exchange, on Euronext Paris and on the Milan Stock Exchange. In 2007, the Company's net revenues were $10 billion. Further information on ST can be found at www.st.com.

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