Samsung 3rd Foundry Ranking, Soon 2nd?

Samsung is growing its foundry sales and looking to make microprocessors for companies that do not have their own fab lines ( Amazon, Sony and Nvidia ). Considering Samsung advances in foundry business in 2012 it is likely that Samsung will surpass GlobalFoundries in 2013 and be 2nd largest semiconductor foundry.

"dedicated semiconductor foundry capacity reached 150 thousand 300mm wafers per month in Q4 2012"

More about Samsung foundry business below.


Ron

Insightful, timely, and accurate semiconductor consulting.
Semiconductor information and news at - http://www.maltiel-consulting.com/

 

Samsung Looking Forward to Make Chips for Amazon, Nvidia, Sony – Report

Samsung Wants to Make Chips Not Only for Apple

by Anton Shilov [07/10/2013 11:55 PM]

 

Samsung Electronics’ semiconductor division is currently the world’s third largest contract maker of chips, mostly due to the fact that it produces vast amounts of different application processors for Apple as well as its own consumer electronics divisions. However, as Apple is looking at different manufacturers and Samsung wants further grows, the company is eyeing other customers.

“Samsung is eyeing Amazon, Sony and Nvidia as customers to offset the lost volume caused by the Apple’s decision to reduce purchases,” a source with knowledge of the matter revealed to the Korea Times.

At present, Samsung is negotiating on a high level with Sony Corp. and Nvidia Corp., presumably over making their chips for smartphones, game consoles, tablets and maybe even personal computers in the future.

Amazon, which has yet to develop its own application processors for its tablets, smartphones and possibly e-book reading devices, has also talked to Samsung, but without any significant outcome, presumably because Amazon’s chip development is at its early stages.

“Samsung is entering a new chapter in logic chips. It is looking for companies with processor design technology, but without manufacturing facilities,” said one industry observer.

 

Samsung has competitive process technologies and vast production capacities to satisfy demands from even such huge clients as Apple. The South Korean company is among a few foundries in the world who has leading-edge manufacturing processes, including 32nm and 28nm, and which is on-track to start making logic chips using 20nm and 14nm in the coming year.

According to market tracker IC Insights, in 2012, Samsung almost doubled its foundry sales and surpassed UMC to become the third-largest IC foundry in the world, according to estimates by IC Insights market tracking firm. It is believed that the company’s dedicated semiconductor foundry capacity reached 150 thousand 300mm wafers per month in Q4 2012. Using an average-revenue-per-wafer figure of $3000, Samsung’s IC foundry capacity currently has the potential to produce annual sales of about $5.4 billion.

Intel Roadmap to 2015 and Beyond: 5nm Technology

Intel discussed roadmap to 2015 at their annual Investor meeting day on the 10th of May 2012 in Santa Clara.

Topic mentioned included the roadway to 5nm process, 450 mm wafers. See more below.

Ron




Intel Roadmap to 2015 and Beyond: 5nm Technology, Merrifield Mobile Processor, Microservers and More

http://www.cnx-software.com/2012/05/15/intel-roadmap-to-2015-and-beyond-5nm-technology-merrifield-mobile-processor-microservers-and-more/


Intel had their annual Investor meeting day on the 10th of May 2012 in Santa Clara where we would learn a few things about what's ahead for Intel and the semiconductor industry. Paul Otellini, Intel President and Chief Executive Officer, started the meeting by giving some numbers about Intel results and showing opportunities existing for cloud and data center, personal computing, mobile devices and intelligent systems (for automotive, retail and communications markets). One interesting point was the tremendous growth in data Intel expects from 2,500 Exabytes per year (7 EB/day) today to 8,000 Exabytes by 2015 which the majority of the growth lead by Big data. He also boasted about Intel technology advantage. For example, Intel introduced High-K Metal Gate technology in 2007 and competitor only got it in products last year (btw Samsung Exynos 5 uses HKMG). They recently introduced Tri-gate technology and they only expect competitors to catch up within 4 years. Finally one of the slide (see below) shows that Intel intends to be able to manufacture silicon using 10 to 5nm technology sometimes after 2015.

Intel Manufacturing Technology Road Map

The technology to achieve this feat is still at the fundamental research stage however. You can read the presentation (PDF) for more details.

Kirk Skaugen, General Manager of the PC Client Group, mainly talked about Ultrabooks which are high-performance, expensive (700 USD up) and thin notebooks. Intel Haswell Processor is designed to power Ultrabooks (in 2013) able to get 10 days of connected standby providing 20 times more efficiency than Intel iCore 5 device available in 2011. If you want to know more about the future for Intel based PC, Laptop and Ultrabook, you can read the presentation.

Diane Bryant, Vice President & General Manager of the Datacenter & Connected Systems Group, mainly talked about high end servers, but there is also a small section about microservers showing Xeon processors (Ivy Brigde) consuming 17W and the lower-end Atom Centerton SoC consuming a mere 6W. You can download the PDF presentation to know more about Intel datacenter and cloud solutions, customers and prospects.

Now let's move to smartphones and tablets with Hermann Eul & Mike Bell of Intel Mobile and Communications Group. They started by showing Intel technological know-how for mobile applications and Intel R&D commitment with over 3,000 engineer working on software for Windows, Linux (Intel is No. 2 contributor) and other operating systems, including 1,200 working on Android for mobile.

Then they gave some details about Atom Medfield processor, their first smartphone processor, which can be integrated into smartphones that support 8MPixel camera, 1080p video via HDMI and last 14 days on a single battery charge (using a 1460mA battery). They also mentioned Anandtech article showing Medfield based Lava XOLO X900 beats the competition in terms of performance (for some benchmarks) and matches the power consumption of existing smartphones.

They also showed their smartphone platform roadmap with processors for both the high end and lower end segments of the market.

Intel Smartphone Platform Roadmap

At the higher-end, we would get:
*Intel Atom Z2580 with Intel XMM 7160 LTE + 2X HSPA+ providing twice the performance of Medfield.
*Merrifield processor with XXM 7260 using 22nm manufacturing process.

and the lower-end:
*Intel Atom Z2000 @ 1GHZ with XMM 6265 (HSPA+)
*Intel Atom 6331 (22nm)

as well as future processors based on 14nm technology.
Intel also provided their tablet roadmap with Clover Trail 1.8 GHz 32nm processor (2012), Bay Trail 22nm processor (2013) and next generation processor (no name yet) using 14nm process (2014).

Have a look at the presentation for more information.

Brian Krzanich, Chief Operating Officer, gave a presentation about manufacturing and fabs which I would not normally mention in this blog, were it not for this slide:

Revenue per Company and Factory Cost Depending on Wafer Size

Currently, silicon Fabs use 200mm wafers which requires company to generate 3 to 5 billions in revenue to stay afloat representing all companies in the chart above (Elpida recently filled for bankruptcy before being bought by Micron). Now some companies starts to move to 300mm. A manufacturing site designed for this type of wafer requires 9 to 12 billions in revenues (shown in green above), but as it scales it becomes much more cost effective than a 200mm wafer Fab. That means that companies such as Freescale, NXP Broadcom and AMD would eventually have to go Fabless to survive, be bought or go bankrupt. After 2015, Fabs designed for 450mm wafer will start to show up (I'm pretty sure there is a mistake on the slide above and "300mm Fab" should read "450mm Fab"). This type of Fab requires 15 billions in revenues according to Intel, which would means that only 2 or 3 companies in the world, namely Intel, Samsung and possibly TSMC will be large enough to have manufacturing sites, unless companies such as Texas Instruments and Toshiba buy smaller players in the meantime.

If you are interested, you can check the PDF.

There were also two other presentations by the sales team and the CFO. You can listen to the webcast and access all the presentation slides on Intel Corporation 2012 Investor Meeting

US Fabs Losing Their Edge. Really?

It is true that "As chip plants get pricey, U.S. risks losing edge", as the article state.

However we should keep in mind that Apple has Samsung manufacture their A5 processor (that runs the iPad) at Samsung's Texas fab.  Apple manufactures in Texas due to the need for a close interaction between Apple's R&D and the Fab development and manufacturing groups. Such eco systems of technologies are a very important part of the development, production, and product supply chain.

The US still has some good manufacturing fabs. Intel is a good example. Intel has been extending its lead in manufacturing since the HKMG 45nm process.
 
As the article mentions, the future of US semiconductors will be strengthened by the industry's joint development of 450mm wafer manufacturing. It is important for the USA to maintain their current position.

Foundry Rankings (Including Samsungs' iPad, iPhone Breakdown)

Samsung's foundry breakdown shows how much of its business is tied to the iPad, iPhone, and iTouch products. For example, in 2011, Samsung's foundry produced $1.975 billion worth of chips. Apple products were $1.5 billion of the total chips manufactured.


Both Samsung and Apple need to diversify from each other. The high cost of new fabs, current commitments, and the length of time it takes to bring up a new fab is slowing this transition. Intel could potentially be another candidate as a foundry for Apple.


Ron Maltiel


Samsung, Win Semi Gain Ground in Foundry Rankings

http://semimd.com/blog/2012/01/12/samsung-win-semi-gain-ground-in-foundry-rankings/

By Mark LaPedus, SemiMD senior editor
The rapid shift towards smartphones, tablets and other products has caused a major change in the foundry business — and overall rankings. Amid the changes, Samsung Electronics Co. Ltd. — and little-known Win Semiconductors Corp. — gained ground in the rankings in the foundry business in 2011, according to IC Insights Inc.

Samsung jumped one place to 4th in the foundry rankings in 2011, according to the firm. After Samsung — which saw 64 percent growth in the foundry business last year — the second fastest growing vendor was Taiwan’s Win Semiconductors, a gallium arsenide (GaAs) foundry specialist that saw 36 percent growth last year.

TSMC remained the world’s largest foundry vendor in terms of sales in 2011, followed in order by UMC, GlobalFoundries, Samsung, SMIC, TowerJazz, Vanguard, Dongbu, IBM and Magnachip, according to the firm.

In total, the pure-play foundry business hit $27.7 billion in 2011, up 4 percent from 2010, according to IC Insights. The IDM foundry business was $4.9 billion in 2011, up from $4.1 billion in 2010, according to the firm.

In addition, Taiwan captured the distinction of being the country/region with the largest share of installed wafer capacity in 2011, according to IC Insights. As of mid-2011, Taiwan held 21 percent of global capacity, surpassing Japan (19.7 percent) and Korea (16.8 percent) to take over top spot for the first time. The Americas region with 14.7 percent share and China with 8.9 percent of capacity rounded out the top five, according to the firm.
C.J. Muse, an analyst with Barclays Capital, said foundry capital spending is expected to hit $18.374 billion in 2012, flat from last year.

The wild cards
There are two wild cards in the foundry business: Intel Corp. and Samsung. Intel has dabbled in the foundry business in recent times and is not a real contender — yet. “Overall, IC Insights believes that the leading-edge IC foundry business is going to be very competitive between the three major advanced technology suppliers — TSMC, GlobalFoundries, and Samsung,” according to IC Insights.

Not long ago, Samsung was a minor player in the segment. But thanks to its business with Apple Inc., Samsung’s foundry sales jumped by 64 percent in 2011, according to IC Insights. In total, Samsung had foundry sales of $1.975 billion in 2011. Of that, Samsung’s foundry business for Apple represented a total of $1.528 billion, according to IC Insights.

Samsung foundry fortunes tied to Apple

“Samsung was ranked as the fourth largest foundry in 2011 and could challenge for the number three spot over the next few years,” according to IC Insights. “It is estimated that Samsung’s dedicated IC foundry capacity reached 90K 300mm wafers per month at the end of 2011 (50K in South Korea and 40K in Austin, Texas).”

“Using an average revenue per wafer figure of $2,500, Samsung’s foundry capacity has the potential to produce annual sales of $2.7 billion,” according to the research firm.



There are also rumors that Samsung could build another logic fab in Texas as part of a move to keep the Apple foundry business. And for some time, Intel has been also looking at Apple as a foundry customer.
“We believe that Intel’s best chance to make material progress outside of the PC market is to become a foundry and manufacture for Apple. However, Samsung (is) doubling its foundry capacity this year. Thus, we think this opportunity for Intel looks less likely in the future unless Intel changes course,” said Auguste Gus Richard, an analyst with Piper Jaffray & Co.

IC Insights believes Apple must move to another foundry over time. At the same time, Samsung must also expand its customer base. “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,” according to IC Insights.

“While Apple and Samsung have exchanged lawsuits regarding system level products, Apple is still very reliant on Samsung for its advanced IC processor production (e.g., A4 and A5). It should be noted that TSMC was working at 100 percent utilization in mid‐2011 and essentially had no ability to allocate large amounts of leading-edge production capacity to Apple devices,” according to IC Insights.
“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, this transition may be destined to happen over a few years rather than a few quarters,” according to the firm.

Besides Samsung, others are also expanding their fab capacities. As reported, Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) recently held a groundbreaking ceremony in Taichung’s Central Taiwan Science Park for Phase 3 of its Fab 15 GigaFab. Fab 15, Phase 3 will be TSMC’s second GigaFab equipped for 20nm process technology. The first 300mm GigaFab, Fab 12 module 5, is located in Hsinchu. Capacity for the Fab 15 Phase 3 is 40,000 300mm wafers per month. In the future, TSMC will make 450mm wafers as well as finFETs at 14nm in Fab 15.

Another vendor, GlobalFoundries Inc., is starting off with a bang in 2012: The company’s 300-mm fab in New York has moved into initial production. As part of its major announcement, GlobalFoundries as well as IBM on Monday (Jan. 9) announced an agreement to jointly manufacture advanced chips at both companies’ semiconductor fabs.

As in 2010, GlobalFoundries was third in the 2011 foundry rankings. Semiconductor Manufacturing International Corp. fell one place to 5th in the rankings. Recently, the Shanghai-based foundry vendor announced that David N. K. Wang resigned as chief executive. It also fell into the red in its most recent quarter.

Israel’s TowerJazz, a specialty foundry, was sixth in the foundry rankings. In June, TowerJazz completed its previously announced acquisition of Micron Technology’s fabrication facility in Nishiwaki City, Hyogo, Japan. The acquisition nearly doubles TowerJazz’s current internal manufacturing capacity, increasing production by 60,000 wafers per month. TowerJazz hopes to achieve its expressed $1 billion annual revenue run rate target by 2014.

Two other specialty foundries, Vanguard and Dongbu, were next in the rankings. IBM was ninth. “Since IBM’s commitment to the high­‐volume foundry business is uncertain, IC Insights believes that this leaves only Samsung as the primary high volume leading-edge IDM IC foundry of the future,” according to the firm.



M&A activity

Besides capacity expansions, the other trend in the foundry business is clear: consolidation. In 2009, for example, GlobalFoundries’ parent company acquired Chartered Semiconductor, which was then merged into GlobalFoundries. Last year, Taiwan foundry vendor United Microelectronics Corp. (UMC) took a majority stake in Chinese foundry He Jian Technology Suzhou Co. Ltd.

Recently, two Chinese foundries, Shanghai Hua Hong NEC Electronics Co. Ltd. (HHNEC) and Grace Semiconductor Manufacturing Corp. (GSMC) merged. “The combined sales of these two foundries would have been $565 million in 2011, which would have been enough to move the new entity into sixth place behind TowerJazz in the 2011 ranking,’’ according to IC Insights.

The next victim in the shakeout could be LFoundry, a small analog and mixed-signal foundry specialist in Germany that is struggling. In 2008, Japan’s Renesas Technology Corp. sold its fab in Germany – Renesas Semiconductor Europe (Landshut) GmbH (RSEL) – to Silicon Foundry Holding (SFH).

Samsung gains ground on foundry rivals