Semiconductor industry prices will become a competitive weapon

More than half of the time in 2013, the global semiconductor market has shown signs of development. According to the latest data from Bruce Diesen, an analyst at the Carnegie Group in Oslo, Norway, global semiconductor growth was 1% in 2013, which was a decrease of 2% in 2012, flat in 2011, and 32% in 2010, reflecting another decline Cycle arrives. However, the industry believes that the semiconductor industry in 2014 may have more obvious growth.

Growth momentum is still accumulating. The growth momentum of the semiconductor industry in 2013 is still accumulating. It is estimated that there will be more obvious growth in 2014. However, before the EUV and 450mm wafer era did not enter, the semiconductor industry may find it difficult to grow by nearly 10%.

Observing the cycle of the semiconductor industry, since the market's soaring in 2010, the 2011 and 2012 years have fallen back. Therefore, the World Semiconductor Market Statistics Organization (WSTS) forecasted a growth of 4.5% in 2013 at the end of 2012 and IHSiSuppli had predicted a growth of 8.2%. However, just over half a year, under the new situation, various analyst organizations have lowered their growth forecasts this year. For example, WSTS released its spring market forecast on June 4, 2013. It is expected that the global semiconductor market will be larger than 2013. The annual growth rate was 2.1%, reaching US$277.8 billion. What are the reasons for this WSTS downgrade?

As we all know, the driving force for the growth of the semiconductor industry has shifted from the traditional PC and related industries to the mobile product market, including smart phones and tablet computers. The difference between the two is that the main user of the PC industry is the enterprise, while the main user of the mobile product market is the individual. Relatively speaking, to allow individuals to purchase electronic products requires money, so it is more closely linked with the global economic environment. Affected by factors such as the European debt crisis this year, including China's economic signs of slowing down, it will have a big impact on personal spending power.

The reason explained by the WSTS is that although the semiconductor market in the United States and Japan will increase by 3.2% and 1.7% respectively this year, Europe has performed extremely poorly under the shadow of the European debt crisis. After falling 1.7% last year, it will fall 3.5% this year. In addition, the Asia-Pacific market, which has always had the largest market and the fastest growth rate, only slightly increased by 0.1% in 2013, which has played a decisive role. The WSTS expects the Asia Pacific region to surpass other major regions to grow at the fastest rate next year, and this prediction has been supported by the SIA (American Semiconductor Industry Association).

In addition, the most fundamental factor in promoting market growth is demand. According to data from market research firm Gartner in June 2013, PC shipments in 2013 are expected to reach 300 million units, tablet PCs will reach 200 million units, and smartphones and feature phone shipments will reach 1.82 billion units. The total shipment volume of electronic products reached 2.348 billion units, an increase of 5.9% from 2.217 billion units in 2012, which fully reflected the steady increase in market demand.

In the OEM market, according to SEMI's latest global fab report, spending on fab equipment in 2013 will reach 32.5 billion U.S. dollars, 2% higher than last year, better than the original forecast, which will decline slightly by 0.6%. In 2014, there will be an astonishing growth rate of 23% to 27%, which can reach 41 billion U.S. dollars, and it will set an unprecedented high.

The amount of equipment spending in wafer factories in recent years was 33.5 billion U.S. dollars in 2010, 39.7 billion U.S. dollars in 2011, 31.8 billion U.S. dollars in 2012, and 32.5 billion U.S. dollars in 2013, and is estimated to be 41.9 billion U.S. dollars in 2014. The above information shows that the kinetic energy of the semiconductor industry in 2013 is still growing. It is estimated that there will be more significant growth in 2014. However, before the EUV and 450mm wafer era did not enter, the semiconductor industry may find it difficult to grow by nearly 10%.

Generational industry growth is better than semiconductor industry The future global OEM market competition may be mainly reflected in two aspects: one is the competition of the low-end smart phone processor market, and the second is Apple's application processor.

Needless to say, the global generation of industry, driven by the mobile terminal product market, has become a star in the semiconductor industry together with fabless.

According to Gartner's data, in the global semiconductor company's 2012 revenue rankings, Intel and Samsung Electronics continue to regain the top two, fabless vendor Qualcomm, which supplies mobile phone chips as the main business, jumped from sixth place in 2011 to third place. name.

Samsung Electronics ranked second in terms of annual growth rate than Intel. Its semiconductor revenue was US$28.622 billion, an increase of 9.5% year-on-year. However, the reason for the high growth of Samsung Electronics may be due to the revenue from the LED segment.

In 2012, Qualcomm’s turnover was US$13.18 billion, an increase of 31.8% year-on-year, and its annual growth rate stood out. Qualcomm's growth was mainly due to the booming smartphone market. Its chips are the main components of many mobile phones and are adopted by many mobile phone manufacturers including Apple.

The statistics of Intel, Samsung and Qualcomm, the three largest semiconductor companies in the world, totaled US$90.88 billion in 2012, accounting for 30.2% of global semiconductor industry turnover. The three companies include nearly one-third of the market, showing that their influence is huge.

According to the final statistics released by ICInsight in 2013, the global semiconductor pure foundry market achieved sales of USD 39.31 billion in 2012, an increase of 20.0% from 2011.

Taiwan Semiconductor Manufacturing Co., Ltd. has been steadily occupying the leading position of wafer foundry due to the success of its advanced process technology, with a market share of 43.67%. Globalfoundries was ranked second due to the high yield of 32nm wafers and the high production capacity of 45nm wafers at the Dresden fab in Germany. UMC’s market share has declined due to the decrease in wafer shipments. Samsung’s foundry revenue relied on Apple’s A6 and A6X chip demand for wafers to rise one place, ranking third, and its 2012 growth rate reached 98%.

The growth rate of the global OEM market will be significantly better than that of the semiconductor industry. The CAGR is about 10%. The reason is that the mobile market continues to promote the integration of more functions such as smart phones and tablet PCs into smaller, thinner, and more power-saving directions. In order to promote the growth of the fabless industry, the main source of the current foundry market is fabless, which is relatively stable compared to OEMs from IDM.

The high-end smart phone processor market has been monopolized by Qualcomm. According to StrategyAnalytics, Qualcomm, Apple, Samsung, MediaTek and Broadcom accounted for the top 5 smartphone market share in the first quarter of 2013. Qualcomm took a 49% share of the market. Apple and Samsung followed closely behind with 13% and 12% respectively. The global smartphone application processor market grew by 50% year-over-year, reaching US$3.6 billion in the first quarter.

The Tablet PC processor market has been monopolized by Apple. According to Strategy Analytics, Apple, Texas Instruments, Samsung, Nvidia and Intel each accounted for the top 5 in the first quarter of 2013 in the tablet PC application processor market. Apple ranks first with its 40% share, followed by Texas Instruments with 13% market share and Samsung with 3% market share. According to reports, the tablet PC application processor market revenue increased by 52% year-on-year to US$740 million.

Therefore, the future competition in the global OEM market may be mainly reflected in two aspects: First, the competition of low-end smart phone processor market, which mainly to MediaTek, Spreadtrum, recently Qualcomm, Samsung also want to join. The second is Apple's application processor's homecoming. Because it is estimated that its orders of about 150 million, according to an average of 25 US dollars per chip, sales of up to 3.75 billion US dollars.

Cost is the key The future price of chips will become a killer. Even if the technology is feasible, due to the cost or economic infeasibility will also affect the applicability of the technology, so the semiconductor industry facing the adjustment of the model under the application of the market.

In the semiconductor industry, Moore's Law is a "holy script," which always motivates the industry to continue to progress without hesitation. Google CEO Eric Schmidt once pointed out that if we look back at Moore's Law, if a semiconductor company sells as many and same products today and 18 months ago, its turnover will be reduced by half, so Moore The law is actually a spur and incentive for all semiconductor companies. It must continue to progress. Otherwise, the same labor is spent, but only half of the previous income. Therefore, although Moore's Law itself is only a conjecture, the process size shrinks by 70% every 18 months, and the pace of this law has never failed. In 2013, it should enter the 14nm era. However, the industry believes that 14nm may be a hurdle. After 10nm, 7nm or 5nm will be more and more difficult, Moore's Law will not be long gone. The fate of the decision law is the cost of the chip.

Mentor's CEO Huang Renxun has proposed that the cost of the chip at 22nm/20nm is unlikely to be lower than 28nm, but will increase. So the industry will face the pressure of rising costs.

The data provided by IBS shows that comparing the 32nm/28nm and 22nm/20nm costs, including construction costs, process development costs, product design costs and mask costs, and to achieve the required balance of financial shipments: at 32nm At the time of /28nm, the cost of building a plant is 3 billion U.S. dollars, the R&D cost of the process is 1.2 billion U.S. dollars, a product is designed to be 50 to 90 million U.S. dollars, and the corresponding set of mask costs is 2 million to 3 million U.S. dollars. In order to achieve financial balance, shipments will reach 30 million to 40 million pieces. At 22nm/20nm, the costs correspond to 4 billion to 7 billion U.S. dollars, 2.1 billion to 3 billion U.S. dollars, 120 to 150 million U.S. dollars, and 5 million to 8 million U.S. dollars, respectively. 60 million - 100 million pieces, so the future market can not accept too many products.

As the lithography technology starts from 22nm/20nm, twice the pattern exposure technology is used, resulting in a significant increase in the cost of lithography and an increase in the cycle time of the process. The proportion of investment in lithography equipment in the former process equipment has increased from less than 10% to 25%, and may even be as high as 50% of the wafer cost.

Therefore, the price of the chip in the future will become a killer. Even if the technology is feasible, because the cost or economic infeasibility will also affect the applicability of the technology, the semiconductor industry faces the adjustment of the model under the application market.

The cost of silicon is always a secret. The following is an example provided by the IBS company in the United States in June 2012 for reference of the industry: The semiconductor industry is progressing due to the decrease in cost, but after the process process reaches 28 nm, the pace of many companies has begun to slow down, because each The cost of the die is much higher than the 40nm at the previous node. The main reason for the decrease of the yield at 28 nm is a large increase in the leakage current, resulting in failure of the device parameters. The 28nm process yield improvement is at least 12 months or more, so the future DFM (design manufacturability) is a challenge for the planar 28nm process. Each time the process technology advances a step, the cost of the technology after the mass production must be lower than the previous generation, otherwise it will lose the momentum of industrial progress.

In general, the semiconductor industry is still centering on cost, device architecture, lithography, 3D packaging, and 450mm. As the industry's driving force has shifted from the traditional PC to the mobile product market, smartphones and tablet PCs will inevitably reshuffle. In the case where the industry and fabless industries continue to dominate, it is necessary to look for new industry operating models.