2003 Beijing Microelectronics International Symposium

1. 2003 Beijing Microelectronics International Symposium Hiroshi Oura Chairman of the Board and CEO Advantest Corporation

2. China’s Promising Role in the Changing Landscape of the Semiconductor Industry “OPEN Architecture is the Future of ATE” • - Contents - • IC and ATE Market Trends • Challenges Facing the ATE Market • OPENSTARTM Test Architecture • Advantest’s Contributions to China

3. ($M) (M Units) 250,000 80,000 200,000 60,000 150,000 40,000 100,000 20,000 50,000 0 0 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Trends in Total Worldwide IC Shipment ( Source: WSTS )

4. Estimated Percentage of China’s Total Worldwide IC Consumption China: $44.6bn 23.4% China: $22.3bn 14.3% 2005 2002 Worldwide: $156bn Worldwide: $191bn ( Source: Spring 2003 iSuppli Forecast )

5. 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Semiconductor Production Equipment Trends by Region ($M) America Europe 40,000 Japan Korea Taiwan 30,000 ROW 20,000 10,000 0 ( Source: SEMI-SEAJ & SEMI Consensus Forecast, July 2003 )

6. Expectations for the China Market 1. Growth of domestic market . Increasing domestic demand . Continued investment by overseas semiconductor manufacturers 2. Abundant Workforce . Lower cost work environment . Competent, highly skilled and well educated labor pool

7. Expectations for the China Market 3. Global manufacturing base for ICs . Pro-active government policies attract overseas investment . Rapid development of industrial infrastructure . Rapid improvement in technical expertise . Cost efficient design and manufacturing opportunities

8. Challenges Facing the Automatic Test Equipment (ATE) Market IC manufacturers are focusing product lines on SoCs • Used in cell phones, digital TV, consumer electronics (DVD players, digital cameras etc.), IC Cards/smart cards, security devices • A wide range of new test solutions are needed for the development, design, and production of these devices SoC Device

9. SoC Development Process Planning System Design Board Prototype Production Delivery Cell, IP Design LSI Design Device Process ES MP MassProduction Lab Evaluation IC Evaluation (Engineering Sample) Yield

10. Challenges Facing the ATE Industry Challenges Facing the IC Industry • Provide the best test solution possible • Provide test solutions in a timely fashion • Extend ATE life span across technological generations • Lower costs • Reduction of product development times • Quickly adapt to sudden changes in device trends

11. ATE Maker A ATE Maker B ATE Maker C Conventional Test Environments Current ATE Business Model Each ATE vendor has unique, proprietary test platform • Drawbacks: • Lack of compatibility between different test platforms • New test environments must be built for each test system • Increasing development times • Rising R&D costs

12. OPENSTARTM Test Architecture A common standard across the IC, ATE and instrument industries • Instrument makers can develop and supply OPENSTAR- compliant modules and software • Open ATE architecture will alleviate the burden on test engineers ATE Maker A New Test Environments ATE Maker B ATE Maker C

13. Mixed Signal Tester VLSI Tester Mixed Signal VLSI Linear DC DC Tester Linear Tester New Tester Test Cost Test Cost OPENSTAR Conventional Test Environments OPENSTARTM Affords the Industry’s Most Flexible IC Test Solution • OPENSTAR’s testing flexibility will enable significant reductions in test costs • Ability to add testing modules as needed ensures optimal use of capital investment • ATE vendors can pass along dramatic savings through procurement of standardized parts

14. SoC Device Customizable to Suit the Device Under Test • By combining OPENSTAR-compliant modules, companies can easily customize their Automatic Test Equipment (ATE) • Companies will be able to upgrade their test equipment by simply adding and/or replacing these modules, enabling efficient use of capital

15. Total Test Solution System Development Process Planning System Design Board Prototype Production Delivery Cell, IP Design LSI Design Device Process ES MP Lab Evaluation IC Evaluation Production or Solution Plan A solution plan to work for each phase of IC development and test.

16. Semiconductor Test Consortium STC offers an integrated test solution, providing a suite of modules tailored to the user’s requirements Customer B Customer C Customer A Apps A Apps C Apps B ＯＡＩ ＯＡＩ Module ＋ Mainframe Module ＋ Mainframe Module ＋ Mainframe Module Module 3rd Vendor ATE Vendor A ADVANTEST IP Licensing Specification Specification Semiconductor Test Consortium (STC)

17. 35 Signed MOU Member (August, 2003) Japan: Fujitsu, Renesas, JEM, NEC, ShibaSoku, TEL, MJC, Sharp, NSW,ADVANTEST USA : Intel, Motorola, Agere, National Instruments, Advanced Energy Industries, GuideTech, Inovys, KVD, Manipulators International, Port Orford Co., Pragmatics Technologies, Roos Instruments, Racal Instruments, StarGen, Stridge, 3MTS, Wavecrest, Xandex, Philips, Analog Devices, ARTEST, MOSAID Systems Europe : Q-star Taiwan : ASE Test, TSMC

18. Advantest Contributes to the Growth of China’s Semiconductor Industry 1. Establishment of a Test Support Center in Beijing . In cooperation with the Beijing Semiconductor Industry Association . To provide local design houses with access to ATE . Will provide ATE training to promote local IC design and development 2. Established joint research laboratory with Shanghai Huadong Normal University . Helped establish classes on testing technology . Installed Advantest ATE for student use . Scholarship program (RMB400,000 over five years )

19. Advantest Contributes to the Growth of China’s Semiconductor Industry 3. Sourcing local manufacturing for OPENSTAR modules & device interfaces . Working together with Chinese partners in development and production

20. “OPEN Architecture is the Future of ATE”