Semiconductor industry will be a huge change equipment suppliers face challenges

According to the in semiconductor equipment and Materials International Association (SEMI) two Gartner Dataquest market analyst sponsored seminar, semiconductor manufacturing equipment suppliers will need to improve its business model, changes in the next few years against the mighty storm type may appear in the industry.

Gartner Dataquest executive vice president Klaus-Dieter Rinnen said the semiconductor equipment and materials will be commercialized, the core difference from design and manufacturing to Semiconductor Intellectual Property (IP). Rinnen said that by 2014, industry integration will lead to less than 10 semiconductor equipment suppliers to meet the needs of 80% or more semiconductor manufacturing equipment. He pointed out that the current 15 companies to meet the needs of the end of 1980s, there were 35 companies in the late.

Equipment manufacturers will also have to face the integration between customers. By 2014, there were fewer than 25 semiconductor manufacturers to build new plants, and now there are as many as 45. Gartner Dataquest semiconductor manufacturing research vice president Jim Walker said, semiconductor and electronics companies will increasingly adopt outsourcing mode, only to retain the core business.

Walker said the industry generally turn to wafer level packaging (WLP) technology will reduce the overall cost of the device. He said, 2003-2008 more than the number of chip packaging compound annual growth rate will reach 21.3%. Walker pointed out that manufacturing economics will promote the manufacturers to cooperate to create a vertical / virtual manufacturing integration, because the semiconductor supply chain outsourcing model. Walker said that by 2010, wafer foundries accounted for at least 30% of semiconductor production.

Rinnen predicted that 2005 and 2006 capital equipment market will decrease 6.5% and 8.5% respectively. He reiterated the Gartner Dataquest forecast that the semiconductor industry in 2005 and 2006 will grow by 5.9% and 6.5%, respectively.

Rinnen said, capital equipment manufacturers should look for other business models, to support the core business. He urged them to follow the example of the aviation industry in which suppliers sell products to a small number of customers.

Walker prediction, EMS and ODM manufacturers will have greater development. He predicted that in 2008 the total sales revenue of these two types of companies will grow from $200 billion in 2005 to more than $260 billion.