South Korean group calls for formation of KSMC foundry
A South Korean academic body has floated the idea of the government helping to create a logic foundry modelled after Taiwan’s TSMC, according to The Korea Bizwire.
The plan for the formation of the Korea Semiconductor Manufacturing Company was discussed at a seminar held by the National Academy of Engineering of Korea (NAEK) held in Seoul on Wednesday December 18.
One of the speakers there said that the South Korean government may need to spend 300 trillon won (about US$200 billion) over the next 20 years to maintain the country’s leading position in semiconductors.
South Korea has two prominent chip manufacturing companies – Samsung Electronics and SK Hynix – both makers of leading-edge memory chips. Samsung also makes logic chips and operates Samsung Foundry but it has struggled in recent years to compete with foundry market leader TSMC. It is thought that Samsung may struggle to acquire business because of its position as a vertically-integrated company and supplier of electronics equipment such as smartphones.
The plan to create an independent KSMC – operating at both the leading edge and offering older manufacturing processes – would help encourage the formation of more fabless chip companies based in Korea, the report quoted speakers in the seminar saying.
Professor Kwon Seok-jun of Sungkyunkwan University. “Taiwan maintains a balanced ecosystem where companies like UMC and PSMC focus on legacy and middle-tech processes, complementing TSMC’s advanced manufacturing. This allows over 250 fabless firms to thrive naturally in Hsinchu,” The Korea Bizwire quoted Professor Kwon Seok-jun of Sungkyunkwan University saying. “KSMC, launched with government support, could play a similar role in Korea.”
A panel of speakers at the event identified challenges to the success of KSMC. However, a successful KSMC would start to address some of these challenges.
They included:
- Narrowing the technology gap with overseas competitors
- Weakening investment competitiveness in Korea
- Lack of South Korean fabless chip companies
- Lack of South Korean packaging facilities
- An exodus of semiconductor talent from South Korea
- Excessive regulation
The committee called for the government to strengthen the semiconductor ecosystem, increase R&D investment incentives and set in place policies to attract and retain talent.
Ahn Ki-hyun, of the Semiconductor Industry Association said that timely support was necessary and called for 300 trillion won (about US$200 billion) in government support – via subsidies and tax credits – to be spent by 2047 to maintain Korea’s semiconductor leadership position.
Related links and articles:
Report: SK Hynix mulls offering advance packaging foundry service
Samsung, SK Hynix partner on processing-in-memory
Intel seeks foundry alliance with Samsung, says report
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