It is shown that South Korean Government has not been participating much in ‘MPW (Multi Project Wafer)’ project, which has been established to develop South Korean fabless companies. It is seen that the project has made slow progress due to Samsung Electronics’ strategy in foundry and inadequate support from the government. However, because the government is planning to provide more fund for the project starting from next year, some people within the industry are asking for support measures that are more realistic.
According to relevant industries, it is shown that there are six companies that have been participating in the ‘MPW’ project this year that has been carried out by COSAR (Consortium of Semiconductor Advanced Research) through Ministry of Trade, Industry and Energy’s support.
MPW indicates a service where a foundry company manufactures prototyping chips from many customers through single wafer. It is useful for startup companies that do not have large-scale R&D facilities or researchers from universities to test their products.
This project has also involved Samsung Electronics’ Foundry Business Department since 2017. It started with an intent to provide opportunities for small companies and researchers from universities to manufacture their prototypes through Samsung Electronics’ foundry business at a relatively low cost considering the fact that the ecosystem of South Korea’s fabless industry has been poor. Samsung Electronics declared many times that it would actively participate in the MPW project.
Total of five and four fabless companies had participated in the project in 2017 and 2018 respectively. While the project was carried out separately in the first half from the second half of this year, level of participation has not improved much. Four companies had participated in the first half while three companies are currently participating in the second half. Iron Device has been participating in the project from the beginning of this year. Considering the fact that there are more than 200 fabless companies in South Korea, participation rate in the past three years was only between 2 and 3%. Although CMOS (Complementary Metal Oxide Semiconductor) image sensor and fingerprint recognition semiconductor are included as new items to the project in the second half, the number of participating companies in the second half is actually lower than that of the first half.
This phenomenon arises from disagreement between the government’s support and the position of Samsung Electronics and fabless companies.
First, it has been confirmed that the government’s support has been insignificant this year. Although the government promised that it would support 70% of the cost of a mask, some say that there is not much difference from the government’s support to the cost of using Taiwanese and Chinese foundry businesses that South Korean fabless companies have been using mostly.
In addition, some say that there is a ‘mismatch’ between Samsung Electronics’ strategy in foundry business and fabless companies’ demands.
Fabless companies mostly use ‘middle-end’ processes that are between 55 and 100 nanometers (nm) considering cost and the level of their technologies. However, Samsung Electronics’ main goal is to increase its market share through the state-of-the-art 7nm EUV (Extreme Ultraviolet) process that targets top semiconductor companies such as Qualcomm and AMD. Majority within the fabless industry believes that there are still many areas that need to be adjusted in order to provide adequate processes for low-end products.
Significant cost and time will be required in order for Samsung Electronics to provide various processes according to the level of South Korean fabless companies or for fabless companies to catch up to the level of Samsung Electronics’ technologies. Also, fabless companies have opposed using other South Korean foundry businesses such as DB HiTek and MagnaChip as they manufacture products mostly through outdated processes.
“Because Samsung Electronics is a private company, we cannot just argue the right and wrong of its strategy in foundry business.” said a representative for the fabless industry. “There needs to be more realistic alternatives according to the state of our industry.”
One positive thing is the fact that South Korean Government is going to invest $10.2 million (12 billion KRW) into the MPW project for the next two years. As a result, there is a high chance that the cost issue that fabless companies have been experiencing will be resolved. Some say that the government should also consider providing monetary support to fabless companies for them to manufacture MPWs through Taiwanese and Chinese foundry businesses until South Korean foundry businesses are able to deal with various demands from the industry.
Staff Reporter Kang, Hyeryung | kang@etnews.com