Will 28 nm Change the Competitive Landscape for Semiconductor Companies? Expert Analyst Mark Li Discusses the Role of 28 nm in Smartphones and Tablets, and Which Companies Hold Market Share

Wall Street Transcript

67 WALL STREET, New York - May 31, 2013 - The Wall Street Transcript has just published its Semiconductors Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Semiconductor Capital Equipment - Cloud Computing, Mobile Device Consumer Demand - Semiconductor Inventory Burnoff - Improvement from Cyclical Bottom - Semiconductor Capital Equipment Spending - New Computing Platform Demand

Companies include: Taiwan Semiconductor Manufactu (TSM), Advanced Semiconductor Enginee (ASX), Apple Inc. (AAPL), Semiconductor Manufacturing In (SMI) and many more.

In the following excerpt from the Semiconductors Report, an expert analyst discusses the outlook for the sector for investors:

TWST: You expect the foundry sector to grow this year. What will be the drivers of that growth, and which companies will be the beneficiaries? Please specifically address the role of 28 nm and how it will change the competitive landscape.

Mr. Li: Foundry demand will be very good this year and mostly driven by smartphones and tablets, from either the high-end such as iPhones, and also the low-end segment. In terms of 28nm - and that's because of the power consumption requirement and the performance requirement in these smartphones or tablets is quite demanding, so you need to have the best technology for smartphones' chipset. That is why even MediaTek's low-end smartphones are quickly moving to 28 nm too.

The 28 nm market by far is captured the marketing leader, TSMC (TSM), which now has 85% or even 90% market share in this technology generation. In terms of near-term dynamics, I expect TSMC will lose some shares this year, but they will be still the dominant player in the market. So I do expect TSMC continues to be the key beneficiary of 28 nm this year.

TWST: You are positive on migration to the flip chip. What is that, why is it important and how will it impact the sector?

Mr. Li: Flip chip is a way of IC packaging. If you look at the IC supply chain, it starts with fabless that design IC and send electronic file, electronic blueprint that contains the design to wafer manufacturers. The wafer manufacturers, called foundries most of time, then fabricate the design on a piece of wafer. Then the wafer will be passed to an assembly company.

The wafer then is passed to assembly companies. They will cut the wafer into small pieces, or dies, and assemble those die with some sort of protecting material, and this is called IC assembly process. Flip chip is a way to do the packaging here...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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