We have become aware of a fire at the Asahi Kasei Microsystem (AKM) semiconductor factory in Nobeoka city in Japan on 20th October 2020. The plant is known for the production of high-end DACs/ADCs IC components for high-end audio devices. We have the latest details…

According to an eye witness… "White smoke is rising from the automatic door on the 4th floor." About 400 employees were evacuated and there are no reports of any injuries. Part of the roof and walls collapsed after a fire broke out on the 5th floor of the building. It took over 80 hours to totally extinguish the fire.

The AKM Group are reported as saying that they would increase outsourcing production to meet market demand. Although there isn’t a detailed description of the specific impact on production and supply, according to the supply chain, the fire has caused panic in the supply chain. It is already being reported that companies using AKM chips, sensors and other products have begun to increase their purchases to prevent possible shortages in the future.

However, considering that the ICs produced by AKM are not common processors, flash memory, memory, etc., it will not affect the overall IC market, but there may be price increases and shortages in specific industries, including the pro-audio sector.

We are already aware that Millennia will be affected by the loss of the supply of chips made in the AKM plant. Millennia Media reported on their Facebook page…

“A shock to the professional and consumer audio industries -- the largest provider of audio ADC and DAC chips "AKM" has experienced a fire in their fab line. I'm told they could be off-line for a year. The disruption to our industry will likely be massive, with possible re-designs to untold numbers of products.

Millennia uses top-line AKM converters in the new HV-316 remote mic preamp. Luckily, we have enough stock to last us for roughly one year of demand. We will be re-designing the ADC circuit in case AKM is not back by 4Q21, assuring no disruption in HV-316 shipments.”

We are also aware that Merging use chips made by AKM in their Horus, Hapi and Merging+Anibus products. This from their website…

HORUS & HAPI

• Hand matched and hand soldered analog componentry.

• AKM AK5578 A/D chip with modified HPF for enhanced performance (AKD8D/DP)

• Ardatech AT1201 A/D chip with modified HPF for enhanced performance (AD8D/DP)

• Individually calibrated quartz clocking mechanism

• Each channel must pass over 30 noise, distortion, CMRR and level threshold tests

• Completely balanced signal path direct to the AD

• A/D and D/A samplerate support from 44.1 -> 384kHz, DXD & DSD64/128/256

MERGING+ANUBIS

• AKM AK5578 A/D chip with modified HPF for enhanced performance

• ESS Tech ES9026 Pro D/A chip

• Each channel must pass over 30 noise, distortion, CMRR and level threshold tests

• Completely balanced signal path direct to the AD

• A/D and D/A sample rate support from 44.1 -> 384kHz, DXD

Others brands we also understand that use AKM chips are RME and miniDSP. Hopefully like Millennia, brands have built up a stock of these specialist products, but with reports of a 12-month break in manufacturing, maybe other brands will follow Millennia’s lead and have to redesign products to get round their reliance on AKM chips. We will see…

While a very different technology this report put us in mind of the Apollo Lacquer Factory Fire in February 2020 when a rather different kind of audio conversion was threatened as a result of a factory fire.