For more than 60 years, the finely divided semiconductor industry has experienced rapid growth, and global capital markets have played a key role. The development of the industry has been a very complex process from a political or economic point of view.From Digitimes
Digitimes has observed and analyzed the global $555.9 billion semiconductor market by looking at different dimensions beyond industrial output. U.S. branded manufacturers such as Intel, Texas Instruments, Nvidia, AMD, and Qualcomm contributed $273.9 billion in revenue, accounting for 49.3% of the global market, allowing U.S. companies to maintain the most influential position in the global market. With the exception of Micron, almost all U.S. semiconductor companies focus on logic chips and are global market leaders.
The semiconductor market can be divided into two segments: memory and non-memory. Memory products typically account for 35-40% of the global semiconductor market, with the rest being non-memory semiconductor products, including logic chips and control chips. U.S.-based Micron and Japan’s Armor Man are the major players in the memory market, but Korean companies dominate the memory segment, which gives Korea 19.3% of the overall semiconductor market.
While the memory market has its own business cycle, buyers can adjust the amount of memory capacity they need based on pricing. This is unlike logic and control chips, which have multiple characteristics. Despite its dominance in the memory industry, South Korea is working to consolidate its presence in IC design and fabs, with a focus on logic ICs and contract chip manufacturing services. It hopes to find a balance for its industry that is tilted toward memory.
Taiwan and China have established a strong foothold in the global semiconductor sector. In addition to its manufacturing capabilities, Taiwan has also enjoyed remarkable success in the field of IC design. Due to the growing demand for imported alternatives, Taiwan-based IC design companies began developing chipsets for PCs, power management ICs, and driver ICs in the 1990s. MediaTek was founded in 1998 with more ambitious goals. China Taiwan IC design companies and IDMs such as Huang, Hongli, and Nanya contributed sales of $53.9 billion, accounting for 9.7% of the world, and China Taiwan ranked third in the global IC design ranking.
Led by STMicroelectronics, NXP, and Infineon, European manufacturers accounted for 8.5% of the global market share. Automotive chips will become a strategic product for all automotive manufacturers to seize future business opportunities. European manufacturers have undertaken relatively little capacity expansion in the past few years. The de-centralization of the semiconductor ecosystem is likely to become more pronounced. The Asia-centric manufacturing structure of the past decades will break down into localized and diversified patterns.
Japanese manufacturers were in their prime in the 1980s and 1990s. Renesas, Armor Man, Rohm and IC design firm Socionext reported total revenues of $36.7 billion, or 6.6 percent of the global market. Can Japan make a comeback? The partnership with TSMC to build a factory in Japan is just the first step, and the deteriorating relationship between Japan and South Korea seems to be bringing Japan closer to China and Taiwan.
The emerging-market force to watch will undoubtedly come from China. China’s demand accounts for 60% of the world market, and more than half of all electronic products are produced in China. Although China’s semiconductor industry started late, the “big fund” and other government support have achieved significant growth. The list of Chinese IC design companies is long, but most do not have much influence in the market. It is estimated that Chinese IC design companies outsource chip production and generate significant sales of $25 billion, adding another $9 billion to the IDM sector, making China the sixth largest semiconductor supplier after Japan in 2021, with a global market share of 6.1%.
The following statistics reflect the intertwined relationship of the IT industry in the context of industry competition and geopolitical influence.