Samsung produce half of the total worldwide smartphone shipments. It probably process similar portion of flash NAND, DRAM , and other semiconductor chips used in these cell phones.
"Samsung and Apple represented almost half of the total worldwide smartphone shipments (168 million) in the second quarter, IC Insights observed. As a result, Samsung is enjoying a tremendous amount of synergy by supplying application processors to the largest (i.e., itself) and second-largest (i.e., Apple) suppliers in the world of smartphones"
Future growth for foundries would not be easy as the article below see "the leading-edge IC foundry business is going to be very competitive between the four major advanced technology suppliers - TSMC, Globalfoundries, Samsung and UMC. With the continued success of the fabless companies as well as the strong movement by many IDMs like TI, Renesas and STMicro to the fab-lite business model, IC Insights expects the IC foundries to witness very strong demand for their services over the next few years."
It is going to be tough to keep up with the cost of new fabs soaring. It will limit the number of foundries in the future. See earlier blogs; TSMC: Single-Customer (Apple? Qualcomm?) Fabs Make Sense , the cost issues were discussed in several earlier blogs starting in the March blog Moore's Law End? (Next semiconductors gen. cost $10 billion).
Ron
Apple the driving force behind Samsung foundry business, says IC Insights
http://www.digitimes.com/news/a20120821PR202.html?mod=2
Press release; Jessie Shen, DIGITIMES [Tuesday 21 August 2012]
IC Insights has published its ranking of the forecast 2012 top 12 IC foundries (pure-play and IDM). TSMC, by far, is expected to remain the leading foundry. TSMC's 2012 sales are forecast to be almost 4x that of second-ranked Globalfoundries, which in turn is expected to have more than 2x the sales of the fifth-ranked foundry SMIC. Samsung is expected to be the largest of only three IDM foundries in the 2012 ranking with almost 8x the sales of IBM, the second-largest IDM foundry.
In total, the top 12 foundries are expected to represent 89% of the total foundry sales (IDM and pure-play) in 2012, according to IC Insights. This share is eight points higher than the 81% figure the top 12 represented in 2009 (before Samsung dramatically ramped up production for Apple). With the barriers to entry (e.g., fab costs, access to leading edge technology, etc.) into the foundry business being so high and rising, IC Insights expects this "top 12" market share figure to steadily rise in the future.
For the second year in a row, Samsung is expected to be ranked as the fourth largest IC foundry. However, IC Insights believes that the company will challenge UMC for the number three spot in the ranking in 2013. Samsung has the ability (i.e., leading-edge capacity and a huge capital spending budget) and desire to become a major force in the IC foundry business. It is estimated that the company's capacity dedicated to its IC foundry business reached 130,000 300mm wafers per month in mid-2012. Using an average revenue per wafer figure of US$2,500, Samsung currently has the potential to produce annual IC foundry sales of about US$3.9 billion, IC Insights indicated.
In the second quarter of 2012, Samsung was by far the largest supplier of smartphones in the world, shipping an estimated 54 million handsets with Apple coming in second after selling about 26 million iPhones. Thus, in total, Samsung and Apple represented almost half of the total worldwide smartphone shipments (168 million) in the second quarter, IC Insights observed. As a result, Samsung is enjoying a tremendous amount of synergy by supplying application processors to the largest (i.e., itself) and second-largest (i.e., Apple) suppliers in the world of smartphones, IC Insights pointed out.
After surging by 82% in 2011, Samsung's IC foundry sales are forecast to jump by another 54% in 2012, which would make it the fastest growing top-12 IC foundry last year and this year, IC Insights said. Moreover, Apple's 2012 share of Samsung's total foundry sales is expected to be 85%. However, as Apple begins to engage other foundries (e.g., TSMC) to produce its custom processors, Samsung will need to make up for these lost sales by signing up additional large-scale customers, IC Insights suggested.
While Apple and Samsung are currently embroiled in a dramatic courtroom battle concerning various lawsuits and counter-lawsuits regarding system level patents, Apple is still very reliant on Samsung for advanced IC processor production for its iPad tablets, iPhone handsets, and iPod portable media players. It should be noted that TSMC was working at over 100% utilization in mid-2012 and essentially had no ability to allocate large amounts of leading-edge IC production capacity to Apple, IC Insights said.
One important factor that is oftentimes overlooked with regards to the Samsung/Apple IC supply relationship is the large amount of memory, both DRAM and flash, that Apple buys from Samsung, the largest IC memory manufacturer in the world. Since Apple is such a big memory customer, Samsung is able to "bundle" its IC offerings to Apple and deliver a cost-effective high-volume supply of leading-edge flash memory, DRAM, and processors to the company. It should be noted that, as of mid-2012, no other foundry in the world could come close to matching Samsung's total IC supply capabilities. Thus, while Apple and Samsung battle it out in the courtroom over system level issues, at the chip level, Apple must continue to endure its "marriage of convenience" with Samsung, IC Insights indicated.
There is no doubt that Apple is looking to diversify away from being so reliant on its major system level competitor (Samsung) for the production of its advanced ICs. However, IC Insights believes this transition is likely destined to happen over a few years rather than a few quarters.
Overall, IC Insights believes that the leading-edge IC foundry business is going to be very competitive between the four major advanced technology suppliers - TSMC, Globalfoundries, Samsung and UMC. With the continued success of the fabless companies as well as the strong movement by many IDMs like TI, Renesas and STMicro to the fab-lite business model, IC Insights expects the IC foundries to witness very strong demand for their services over the next few years.
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