China May Become an OEM Center of Low-End Chip

Published:2011/1/14 1:53:00 Author:Amy From:SeekIC

We have made a great achievement in the industry of semiconductor in 2010. According to the MII date, the growth rate was up to 31% from 110 billion of 2009 to 114 billion of 2010, in which IC design industry increased to 55 billion which was increased by 107% when contrasted by 26.5 billion in 2009.

We may think that how this result came out. Was it by driven of government policy or vast investment? We can not tell. The trend of global semiconductor industry, however, can be learned that the goose hangs high, especially after global OEM industry achieved 40% growth. The prediction of semiconductor industry in China seems not having some distinctive features so far, but we should seize the chance to take advantages of global OEM industry tendency to speed up the development of semiconductor industry of China.

The industry environment is pretty favorable for OEM at this moment. Some lager IDM plants adopt fablite strategy by cooperating with enterprises offering OEM instead of taking 32nm in the processing producer of high-end chips. It was reported by SEMI that there were 27 chip workshops in variety sizes production shut down in 2009, 15 in 2010 and there were 8 more published to shut down in 2011. Among these workshops, most of them are the 4-8 inch production lines. Perhaps it was a bad news to some workshop owners, but it was evangel for foundry in the entire world.

Besides, as the development of emerging industry, many top IDM factories are repositioning by carrying out the policy of fabilite to entrust the advanced processing procedure to OEM factory. At the same time, many mature products are in the shortage of capacity such as IGBT, Power IC resulted from closure of 4-8 inch chip production line. These big factories are anxious about taking risk for amplifying capacity through vast investment, while it is happened to be a good time to seek cooperation opportunities for Chinese chip manufacturers. In addition, Elpida’s Korea-resistance plan on memoriser gives chances to the firms of Taiwan, so do Chinese factories since difficult coordination of discrepancy between market and capital still existing. Lastly, Twelfth Five-year Program indicated that the semiconductor industry in China will enter into a new stage of flourishing by various policies and supporting to accelerate the chip industry progress.

To sum up, the semiconductor industry of China should grasp the opportunities by the tendency of global semiconductor developing, especially when fabite strategies implemented by a number of IDM firms and many closures of 4-8 inches chip manufacturers. In fact, the environment of competition is not as optimistic as we imaged, so it is high time that the government took measures to support the semiconductor industry without any hesitation, and created more chances to face competition. The related integrated circuit is JS-6MN-K.

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