Taiwan Semiconductor has no weaknesses?

When it comes to the semiconductor industry in Taiwan, China, the first thing that comes to mind is definitely foundry.

Not long ago, Semiconductor Industry Observer published the article "What is the level of chip manufacturing in Taiwan, China?" " The article introduces Taiwan's layout and strength in chip manufacturing, showing the importance of Taiwan's semiconductor industry.

However, under the huge aura of wafer foundry, we should not ignore the proportion and value of Taiwan's IC design and packaging and testing links in the global semiconductor industry.

According to data released by the Institute of Industrial Intelligence (MIC), Taiwan, China, occupies an important position in the three major fields of global semiconductor IC design, wafer foundry, and IC packaging and testing.

In 2021, Taiwan's wafer foundry and packaging and testing industry revenue ranked first in the world, with global output value accounting for 62% and 61.5% respectively; IC design revenue ranked second in the world, with a global output value market share of 24.3%, only Second to the United States.

Today we will take a look at, in addition to the well-known wafer foundry companies, what are the leading companies in Taiwan, China, in the field of IC design and packaging and testing, as well as their technical level and layout.

Compared with the outstanding wafer foundry, in fact, the chip design link has always been Taiwan's strength.

In the field of chip design, although the United States has continued to dominate the list for more than ten years. However, the strong foundry advantage has provided "fertile ground" for the development of Taiwan's IC design industry and promoted the business development and status improvement of Taiwan's design companies.

In fact, friends who are familiar with the history of Taiwan's semiconductor development should know that when talking about Taiwan's IC design industry, they cannot avoid the "United Family Army" that supports half of Taiwan's IC design.

"Lianjiajun" refers to a series of companies related to UMC such as MediaTek, Novatek, Xinxing, Faraday Future, Yuanxiang, Lianyang, Holtek, Silicon Systems, etc., which are basically separated from UMC. operational.

When it comes to UMC, many people may only know it as a wafer foundry, but in fact, its other important identity is the incubator of many chip design companies in Taiwan, China.

Looking back to 1983, when UMC was first planned and established, it was defined as an enterprise that transformed the technology of Taiwan Industrial Research Institute. Like many semiconductor companies of that era, UMC was engaged in both IC design and manufacturing. In 1994, UMC even launched Taiwan's first microprocessor chip compatible with Intel 80486. But because it didn't get authorization from Intel, it ended up being nothing.

By the mid-to-late 1980s, with the establishment and development of TSMC, the division of labor in chip design and manufacturing had gradually become clearer, and UMC began to face new challenges.

From the perspective of its customers, because UMC itself has a chip design department, if they hand over their chip designs to UMC for foundry, there is a possibility of stealing customer designs; in addition, UMC itself is also considering transformation. Since around 1995, UMC has gradually spun off its chip design-related departments. These spun-off chip design companies have formed a relatively complete chip ecosystem in Taiwan Province, which has also created the "Lianjia Army" later. "Brilliant.

Combined with the revenue ranking of Taiwan's top ten IC design companies in 2021 compiled by TrendForce, let's take a look at Taiwan's strength in the IC design field.

So far, MediaTek is still the best "United Family Army".

In 1997, UMC spun off its multimedia business unit to form MediaTek, which can be said to be the fastest-growing chip design company in Taiwan in recent years.

In the early days of its establishment, MediaTek's main product was CD-ROM chipsets. After CD-ROM, MediaTek became famous in DVD chips, and once occupied 60% of the chip market in the mainland DVD market. Since 2000, MediaTek has invested in the research and development of wireless communication baseband and radio frequency chips. In 2002, it has become one of the top ten IC design companies in the world. In 2003, it invested in the research and development of digital TV and LCD TV control chips.

In 2021, MediaTek will become the king of smartphone chips in China. According to data from the research organization CINNO Research, MediaTek ranks first in China’s mobile phone chip market in 2021 with 110 million units. Dimensity chip mobile platform's global smartphone market share reached 40% in 2021, ranking first in the world. MediaTek officially stated that MediaTek also ranks first in China's 4G and 5G smartphone market share, and 2 out of every 5 mobile phones in the world are equipped with MediaTek Dimensity chips.

Novatek's predecessor was the Commercial Products Division, one of the design departments of UMC. Like MediaTek, it was also independent from UMC in 1997.

As the world's largest driver IC manufacturer, Novatek's main products in the early days were computer peripheral chipsets. In 1999, it decided to enter the LCD panel driver IC market. After 2000, it turned to LCD driver ICs and system single chips. It used to be keyboard and mouse controls. The world's largest supplier of medical devices, it was officially listed on the Taiwan Stock Exchange in 2001.

iSuppli data shows that in 2007 Novatek's driver chips for large-size LCD flat panel displays accounted for 22% of the global market, ranking first in the world. In 2008, according to GSA rankings, Novatek ranked the eleventh largest chip design company in the world in terms of annual revenue. In 2015, it successfully ranked among the top ten IC design companies in the world, ranking tenth. By 2021, Novatek's consolidated revenue hit a record high, breaking through the 100 billion mark for the first time, becoming the world's sixth largest IC design manufacturer.

In addition to driver ICs, Novatek also provides other panel-related chipsets including MEMC, FRC, PMIC, CMOS image sensing IC, and touch panel IC, which can help reduce customer product launch time and improve integration.

Later, Novatek also extended its tentacles to markets such as automotive-grade image processing systems and artificial intelligence machine vision to enhance its market competitiveness.

Realtek was founded in 1987. It initially produced computer peripherals, and later began to develop network chips. In 1991, it launched Taiwan's first self-developed Ethernet card controller RTL8002. In 1997, with the launch of its three-in-one network Chip card has become the world's largest supplier of Ethernet and high-speed Ethernet chips, capturing nearly 50% of the global market share. In 2016, Realtek Technology's revenue grew as high as 22.5%, ranking among the top ten in global IC design for the first time.

Qijing Optoelectronics was founded in 2001. Its products are used in various consumer electronics brand products around the world. It is technologically advanced and maintains its position as a leading manufacturer of semiconductor solutions for image display and processing technology. In 2021, the hot driver chip industry will allow Himax to rank among the top ten IC designs in the world for the first time.

In the fourth quarter of 2021, Himax's automotive display driver IC revenue reached a new high, with an annual increase of 110%. At present, Himax's automotive display driver IC has a global market share of more than 40%, ranking first in the world in 2022 The goal is to double the growth again.

Qijing Optoelectronics has also successively established technical support and business offices in Japan, South Korea, mainland China and other places. The branch in Shenzhen is named Qijing Optoelectronics (Shenzhen) Co., Ltd.

Ruidian Technology was founded in 2003 and is a manufacturer under AUO. It started from LCD DDI and successively launched Touch IC, TCON, Power IC, OLED DDI and other products, which are mainly used in laptops, monitors and TVs with large-size panels, and Small and medium-sized panels are used in tablets, mobile phones, wearable devices, digital cameras, and automotive applications. Mini LED and Micro LED technologies are also currently being developed.

Huirong Technology was formerly formed in 2002 through the merger of Silicon Motion, which was founded in Silicon Valley, California, in 1995, and Huiya Technology, which was founded in New Taipei City, Taiwan, in 1997. Its main products are NAND flash memory control chips, which are used in MP3 and personal computers. , cameras, notebook computers and broadband multimedia phones and other fields. More than 6 billion units were shipped between 2008 and 2018.

Jinghao Technology was founded in 1998. It focused on basic memory IC design in the early days. After merging with Jixin in 2005, its product line expanded to analog and mixed-signal ICs. The product structure is dominated by memory chips, accounting for about 90% in total, including DRAM and SDRAM storage ICs accounting for 55%, FLASH storage ICs accounting for 22%, MCP accounting for 13%, and analog/digital analog mixed signal (Audio/Power) ICs. Accounting for 10%.

Sichuang Electronics was formerly known as Guanlin Technology. In 1998, Guanlin officially changed its name to Sichuang Electronics, and transformed into an IC design company. It established a consumer IC design team and established a system-on-chip (SoC) division; in 1999, it established a liquid crystal driver (LCD) Business Office. The current focus is on small-size display driver DDICs, and its application areas include industrial control, mobile phones, Internet of Things and other terminal products. In recent years, the company has invested in other application areas through incubating subsidiaries, including power control ICs, optical sensors, micro-electromechanical sensors, capacitive touch chips, etc.

Duntai Electronics Duntai was established in the United States in 2005 and moved back to Asia in 2006 to set up R&D and engineering service centers in Taiwan and Shenzhen.

In the early days of its establishment, it was mainly engaged in the development of TFT-LCD display driver chips. In 2007, it began to invest in the design, development, manufacturing and sales of capacitive touch screen control chips; in 2010, it added technical service centers in Beijing and Shanghai; it was listed in Taiwan in 2013. It also established a technical service center in Xi'an; in 2014, it announced the acquisition of Xuyao ​​Technology to grasp the two major industry trends of display and touch.

Duntai Electronics is one of the first companies in the world to engage in the research and development of capacitive screen multi-finger touch technology. It is also the largest capacitive screen touch IC supplier in Asia. The second company to mass-produce capacitive touch screen control ICs.

Phison Electronics was founded in November 2000. It started by providing the world's first single-chip USB flash drive control chip, and has become a leader in the field of control chips for USB flash drives, SD memory cards, eMMC, UFS, PATA, SATA and PCIe solid-state disks. leader.

In addition to the above-mentioned companies, there is also Lianyang Semiconductor from UMC in Taiwan's IC design field.

Lianyang Semiconductor was also spun off from UMC. Since their founding team was the same group of people who researched X86 processors at UMC, they were once regarded as the "number one player" in the Lianjia Army. But later their development did not meet the expectations of the industry, but they still expanded their sphere of influence step by step.

It is understood that Lianyang focused on the development and design of desktop computer (PC) and notebook computer (NB) control chips in its early days. Later, it acquired Liansheng Semiconductor, Huizhan Technology, and Jinghan Technology, which are also part of the Lianhua Electronics (UMC) Group. , allowing the company to expand new product lines such as flash memory control chips, digital TV reception control chips, multimedia control chips and analog chips. Current products include PC/NB control IC, flash memory (Flash) control IC, digital TV reception control IC, multimedia control IC and analog IC, etc.

In the packaging and testing field, according to a CINNO Research report, the market revenue of the top ten global semiconductor packaging and testing (OSAT) manufacturers increased to approximately US$17.5 billion in the first half of 2022, a year-on-year increase of 16.7%.

Among them, Taiwanese companies in the top 10 shortlisted companies occupy 5 seats, namely ASE, Licheng Technology, KYEC Electronics, Nanmao Technology, and Qibang, with a total market share of 41%.

ASE is headquartered in Taiwan and was established in 1984. ASE is the world's largest independent semiconductor assembly and testing services company. Its main business is semiconductor packaging and testing, chip front-end testing, wafer probing, back-end packaging and other related materials. After years of development, it has successfully become the world's largest semiconductor packaging and testing group, and its market share has long ranked first in the world.

ASE Group has semiconductor packaging, testing, materials and electronics plants in Shanghai, Suzhou, Kunshan and Weihai in mainland China.

In early this year, ASE Holdings issued an announcement announcing that it had reached an acquisition agreement with Beijing Zhilu Capital, a market-oriented investment institution, to sell 100% of the interests in ASE Sealing and Testing (Hong Kong) and four mainland packaging and testing factories directly or indirectly held by ASE Sealing and Testing Holdings. Zhilu Capital and its subsidiaries are valued at US$1.46 billion in cash.

The assets sold by ASE Holdings this time were established through acquisitions and joint ventures in 2002 to meet the different needs of partners for high-end and low-end packaging and testing. Its product application areas include analog, digital-analog hybrid, power devices, RF, etc. , serving consumer, industrial and communications customers. Nowadays, part of the production capacity is being transferred to optimize the resource allocation and strategy in mainland China, strengthen the development of advanced technology and cutting-edge capabilities in Taiwan, and better serve global customers.

Founded in 1997, LiCheng Technology is an industry-leading semiconductor packaging and testing company that provides customers with complete semiconductor back-end supply chain construction and all-round packaging and testing services. It is headquartered in Taiwan, China. The service scope covers wafer probing, packaging, testing, pre-burning to global shipment of finished products.

PowerCheng Technology (Suzhou) Co., Ltd. is a wholly-owned subsidiary of PowerCheng Group and was established in September 2009. Currently, Licheng (Suzhou) has more than 600 employees. The company was formerly known as AMD Semiconductor and Spansion Semiconductor. It has more than 20 years of mass production experience and is the first domestic company with 12-inch wafer production technology and multi-layer wafer stacking. An advanced packaging enterprise with sealing technology. Breaking through the previous operating model that focused on manufacturing, in addition to maintaining the existing semiconductor packaging and testing, it has now introduced a patch production line, established a sales and customer service team, and has its own R&D center and localized supply chain. In addition to the existing flash memory, the product range will also be expanded to other forms of memory, logic components, etc.

In December 2014, the headquarters of Licheng Technology decided to join forces with the storage giant Micron Technology and formally signed a contract to jointly invest US$250 million to establish a chip packaging factory in Xi'an High-tech Zone. The company is named LiCheng Semiconductor (Xi'an) Co., Ltd. Licheng Semiconductor (Xi'an) officially opened on March 25, 2016, and mass production began in April 2016.

Founded in 1987, KYEC provides testing and packaging technology and production capacity services for the back-end manufacturing of global semiconductor products. Its service areas include wafer probing (accounting for approximately 45%), IC finished product testing (accounting for approximately 46%) and wafer testing. Grinding/cutting/grain picking (about 9%), etc. The product line covers Memory, Logic&Mixed-Signal, SOC, CIS/CCD, LCD Driver, RF/Wireless, and the total number of test machines exceeds 4,500. In terms of main customer groups, Fabless customers account for about 73%, Foundry factories account for about 3%, and IDM companies account for the remaining 24%.

As the world's largest professional testing company, KYEC Electronics has received certification and orders from leading manufacturers in the mobile phone, wireless communications, LCD driver IC, graphics card, special DRAM, NOR Flash, consumer electronics IC and other markets, allowing the company to Its revenue has grown rapidly, reaching new highs repeatedly, and its product line structure has become increasingly stable.

The subsidiaries Jinglong Technology and Zhenkun Technology invested in China have production plants located in Suzhou. They are also engaged in semiconductor product packaging and testing business. They are the group's production and sales base in China and serve the mainland market nearby. In addition, we have business bases in North America, Japan, and Singapore to provide real-time services to customers around the world.

Nanmao Technology was founded in 1997 and has a leading position in the field of semiconductor packaging and testing. It was listed on the Taiwan Stock Exchange in 2014.

Nanmao Technology not only provides customers with diversified back-end testing services for memory semiconductor and mixed-signal products, but also actively expands production capacity and increases technical service items for display driver IC products in recent years. The display driver IC packaging and testing capacity ranks first in the world. No. 2 in the world.

These products are mainly used in various computer products, LCD TVs of various sizes, flat panel displays and high-end consumer electronics products. Its service targets include semiconductor design companies, integrated component manufacturing companies, and semiconductor wafer fabs.

Currently, most of the testing and packaging equipment and machines are located in factories in Hsinchu Science Park and Southern Science Park. The factory in Hsinchu Science Park mainly provides testing services, while the production lines in Southern Science Park mainly provide packaging services. Service is the focus. The production lines for metal bump manufacturing and wafer testing are built in its own factory in Zhubei. Through such an arrangement, not only can testing and packaging technical services be fully utilized as independent operations, but also technical resources can be integrated to provide a series of complete full-service services. In addition to providing semiconductor back-end process services, Nanmao also cooperates with customers around the world to provide vertically integrated and complete semiconductor process services to global customers through its global operating bases.

Founded in 1997, Qibang Technology is a company that provides a full set of turnkey services for LCD drivers from wafer collision to packaging back-end assembly processing. Mainly engaged in the manufacturing and sales of bumps (gold bumps and tin-lead bumps) and providing back-end tape-and-reel flex packaging (TCP), tape-and-reel chip-on-film (COF), chip-on-glass (COG) and other services . The current revenue structure can be mainly divided into two parts: bump production and packaging and testing. Its main downstream application products are almost all LCD driver ICs. The rise and fall of its operations are closely linked to the prosperity of the LCD industry.

In addition to the top 10, Taiwan also has a number of packaging and testing companies such as Chaofeng Electronics, SiGe Corporation, Huatai Electronics, Tongxin Electronics, Xinquan, and Fumao Technology. Looking at the overall global market, Taiwan, China, has captured about 50% of the global packaging and testing market share.

In recent years, the chip competition around the world has become increasingly fierce, and talent, as the key to victory, has become the object of competition among countries/regions. The development of the semiconductor industry has allowed the world to see Taiwan, China, but there is currently a serious practical problem, that is, it is increasingly difficult to find matching talents for the semiconductor industry in Taiwan.

According to Singapore's "Lianhe Zaobao", as Taiwanese companies such as TSMC continue to expand production and overseas companies continue to invest in Taiwan's semiconductor industry, many semiconductor companies including TSMC, UMC, and MediaTek have expanded talent recruitment, and many upstream and downstream manufacturers have also in this way. According to public information from the job search website "104 Job Bank", there were 1.017 million job opportunities in September this year, another record high. Among them, the largest shortage of scientific and technological talents such as electronic information, software and semiconductors was as high as 189,000.

In other words, Taiwan's semiconductor industry is currently facing a dilemma of not being able to recruit people.

Previously, the "Semiconductor Industry and Talent White Paper" by 104 Job Bank also showed that there is a shortage of engineers related to related processes in the upstream, midstream and downstream of semiconductors. The gap is as high as 15,000 per month, which has exceeded the number of front-line packaging workers.

In addition, the Hsinchu Science Park, which gathers major semiconductor manufacturers such as TSMC, Advanced Micro Devices, and AUO, has seen a significant increase in the number of job vacancies by 2.1 times in just three years since 2019.

In this regard, Chen Shuzhu, deputy director of the Hsinchu Science Park Administration Bureau, said frankly that there is currently a serious imbalance between the supply and demand of talents in Taiwan's semiconductor industry. Behind this wave of recruitment expansion, the problem of insufficient cultivation of local talents in Taiwan's semiconductor industry has been exposed.

In an interview, Zhang Yaowen, dean of the School of Electrical Engineering and Information Technology at National Taiwan University, also said that the talents needed by the semiconductor industry, especially those in the middle and upper classes, need to have solid mathematical knowledge and training to have the professional ability to implement and innovate high-level technologies; the relevant talent pool is not It is constantly shrinking, which is a disadvantage for semiconductor companies.

As the number of science, technology, engineering and mathematics (STEM) higher education graduates in Taiwan decreases year by year, Taiwan’s advantage of producing generations of talented semiconductors seems to be disappearing. According to previous data analysis conducted by Taiwan's education department, with the rise of hospitality, tourism, digital animation and cultural and creative product industries, related departments have absorbed some students who might have chosen to study STEM. In addition, Taiwan's industrial application and R&D design The demand for high-end technology in manpower and the effect of a declining birthrate have led to the suspension or transformation of some electronic and electrical engineering departments.

Not long ago, TSMC President Wei Zhejia also talked about the current biggest challenges in the semiconductor industry and talent issues in an interview. He said, "Talent is the key to progress in an industry. It takes at least eight years to cultivate a qualified, efficient and productive engineer. For any country interested in building a semiconductor industry, my advice is always to cultivate talents first."

In the context of the scarcity of semiconductor talents, major Taiwanese companies have formulated talent recruitment plans and used measures such as internal referral rewards, salary increases, school-enterprise cooperation, and stock purchase subsidies to compete for talents.

Against the background of talent shortage, in addition to major Taiwanese companies "showing off their talents" to recruit and retain talents, relevant departments in Taiwan are also jointly working with corporate "chip schools" to train the next generation of semiconductor engineers. In fact, not only in Taiwan, China, solving the problem of talent shortage has become a common issue faced by the global semiconductor industry.

In addition, the slowdown of Moore's Law, exponential increases in chip manufacturing costs, and market distortions caused by geopolitical tensions have become great challenges facing the industry.

Taiwan Semiconductor's current achievements stem from decades of hard work by industry chain manufacturers. The semiconductor industry is now the lifeblood of Taiwan's economy. Taiwan, China, has occupied an important position in the three major fields of global chip design, wafer foundry, and packaging and testing. .

Today, the whole world is competing for advanced processes and advanced packaging technologies, which is both a threat and an opportunity for Taiwan Semiconductor.

Under strong competitive pressure, talent challenges are becoming the key to the future development of Taiwan's semiconductor industry. Semiconductor is a talent, capital, and technology-intensive industry. Talent is the key soul of the industry in the next twenty years. Those who gain talents will gain the world of semiconductors.

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