Samsung aims for global semiconductor dominance

In August this year, South Korea's Samsung Electronics announced a grand plan to invest 240 trillion won in the development of its semiconductor business over the next three years, demonstrating its ambition to become the world's number one.

Samsung Electronics has consistently ranked first in the global memory semiconductor field, while another Korean giant, SK Hynix, ranks second in the world. However, memory semiconductors only account for about 30% of the total semiconductor sales, and the remaining 70% are mainly system semiconductors, and memory semiconductors are greatly affected by international price fluctuations.

In the field of non-storage semiconductor design and manufacturing, Korean companies including Samsung Electronics still face challenges from leading companies such as China's TSMC and the United States' Intel. For example, in the foundry production of semiconductor crystal wafers, Samsung's market share in 2021 was only 17.3%, a large gap compared with TSMC (52.9%), which sits firmly in the first place. In terms of R&D investment in system semiconductors, Samsung does not have an advantage in the global market.

To cope with this situation, Samsung, the South Korean electronics giant, began to make efforts. After Lee Jae-yong, the vice chairman of Samsung Electronics, who was imprisoned for his involvement in the "cronyism" case, was released on parole and returned to the front line of management, he immediately announced a "three-year economic revitalization" plan focusing on system semiconductors, biotechnology, and next-generation communication equipment, and aimed at integrating and revitalizing the South Korean semiconductor industry.

According to the plan, Samsung Electronics will invest 180 trillion won of the 240 trillion won in domestic investment, of which 150 trillion won will be used to consolidate and develop the semiconductor industry, and will hire 40,000 new employees. Public opinion believes that Samsung's spending more than half of its investment on semiconductors and focusing on new technology development and recruiting talents undoubtedly shows its firm determination to stay ahead in the global semiconductor competition.

In the semiconductor industry, Samsung plans to further consolidate its advantages in global memory semiconductors, such as launching 14nm DRAM and 7th-generation V NAND flash memory as soon as possible, and to focus on mid- to long-term demand changes by expanding investment to lay the foundation for strengthening the competitiveness of system semiconductors. At the same time, Samsung is planning to build a second chip foundry in the United States and is considering accelerating large-scale acquisitions and mergers in the fields of automotive semiconductors, 5G, and artificial intelligence.

In terms of new technology development, Samsung is committed to developing a new generation of GAA (Gate-all-around) process to reduce chip area and power loss and further improve performance compared to existing technologies.

Analysts believe that Samsung's announcement of strong investment in semiconductor chips, amid the good news of a surge in global chip foundry demand and rising prices, reflects Samsung's intention to accelerate the construction of a system semiconductor ecosystem. As Samsung Electronics, which is firmly in the top spot as a memory chip manufacturer, whether it can catch up in the field of system semiconductors has attracted much attention.