Taiwan claims world’s 2nd largest fabless IC market share

Taiwan companies held the second largest fabless integrated circuit market share in the world at 18 percent last year, compared to 17 percent in 2010, according to the latest survey released by U.S.-based market research firm IC Insights.

Taiwan's top IC design houses, which do not have fabrication facilities of their own, include MediaTek Inc., Novatek Microelectronics, Realtek Semiconductor, Himax Technologies and Richtek Technology. In particular, MediaTek, headquartered in northern Taiwan's Hsinchu City, is known as a major supplier of complete solutions for highly integrated system on chips.

The value chain of the IC industry is composed of three segments, namely IC design, manufacturing, and packaging and testing.

Over the years, IC design companies have enjoyed consistent business growth, accounting for 30 percent of the world's overall IC sales in 2016, compared to only 18 percent 10 years earlier, according to the report.

The IC Insights survey revealed that U.S. companies continued to garner a majority share of global fabless IC sales at 53 percent last year. This is a significant decrease from 69 percent in 2010, due in part to the acquisition of U.S.-based Broadcom by Singapore-based Avago Technologies, the report stated.

While ranking second in international fabless IC sales, Taiwan remains the leader in IC production capacity. According to the Global Wafer Capacity 2017-2021 report published by IC Insights in February, the nation held 21.3 percent of the world's IC fabrication capacity in 2016, a slight decrease from 21.7 percent in 2015, when the country first took its leading position in the industry.

Two local firms�Taiwan Semiconductor Manufacturing Co. and United Microelectronics Corp., both headquartered in the northern city of Hsinchu�occupied 73 percent of the country's overall capacity last year, according to IC Insights. In addition, TSMC and Taiwan's top IC design house MediaTek Inc. were ranked sixth and seventh in the world, respectively, in semiconductor R&D spending for 2016, the U.S. market research firm reported.

According to TSMC, the world's largest dedicated IC foundry, the company is continuing to invest heavily in the development of advanced process technologies in order to maintain and advance its position in the industry. The firm said it will likely begin large-volume production of 7 nanometer and 5 nm nodes in 2017 and 2020, respectively.

Meanwhile, the major global IC foundry projected its production capacity to increase by 10 percent this year to reach 11 million 12 inch equivalent wafers. Its standard 28 nm process technology will be used to churn out about 2 million wafers, which the firm said will help lead to annual sales growth of 5-10 percent this year.

Source: Taiwan Today