Advancement of the Semiconductor and Display Industries – A Perspective from Korea
The global market share of Korean companies in the semiconductor memory device and display panel industries remains number one. A series of recent reports suggests that Samsung Electronics and Hynix may be able to benefit from the present recession and improve further if they can overcome the current economic crisis. However, this situation is very different if we consider the core materials, equipment, and parts of semiconductor devices and display panels. The domestic market share of Korean semiconductor equipment and materials companies is only slightly above 20%. In particular, expensive domestic preprocessing equipment, with price tags of several billion won per unit, is rarely used in domestic production lines, and their localization rate is very low, at around 5%.
Kwang-Sun Kim, Professor, Korea University of Technology and Education & Honorary Chairman, Korean Society of Semiconductors and Display Equipment Technology
It is thought that the total localization rate of domestic semiconductor equipment and materials must exceed 60% in order for the Korean semiconductor industry to truly enter advanced country conditions. The development of the semiconductor and display industries without the localization of core equipment, materials, and parts is like building a castle in the air.
There is one important indicator of international competitiveness in the semiconductor and display equipment and materials industry, and that is standardization activity. One of the international organizations leading the global standardization of semiconductor and display equipment and materials is Semiconductor Equipment and Materials International (SEMI). Established in 1970, SEMI represents the global semiconductor equipment and materials industry, currently worth 100 billion dollars. It is the only organization related to the industry in the world, and consists of over 2,000 member companies around the globe, including 180 in Korea. There are currently over 780 standards established by SEMI, and to date, the standardization activities have primarily been led by the USA, Japan, and Europe. Unfortunately, Korean manufacturers of semiconductor and display equipment and materials have not been highly active in the international standardization activities of SEMI,
In order to promote the standardization activities of the semiconductor and display equipment and materials industry, the CEOs of Korean manufacturers need to first increase their awareness of these activities. They must recognize the importance of standardization, and make an effort to train and support technical diplomats who will help create international standards, persuade engineers to apply them, and freely communicate on the global stage. Companies cannot survive in an internationally competitive marketplace without a full understanding of international standards. In capital- and technology-intensive industries such as semiconductor and display, standardization is an essential activity in the creation of new markets, in making existing markets more efficient, and in increasing profits.
Technical diplomats who can work on the global stage are not born overnight, and it is difficult to expect small- and medium-sized companies with low levels of competitiveness and financial stability to train human resources extensively. In the semiconductor industry of late, Intel (USA), Samsung Electronics (Korea), and TSMC (Taiwan) have initiated discussions on standards, seeking to change the existing 300mm wafer system to a 450mm wafer system to reduce costs. Although domestic Korean manufacturer Samsung Electronics is participating, it would be onerous for domestic equipment and material manufacturers, who have focused their efforts on developing products in line with the 300mm wafer standards, to respond quickly to a new 450mm standard system alone. The Korean government, academic circles, and the industry must recognize this serious crisis of standardization, and work to establish programs to build up the country’s excellence in technical diplomats and human resources. I hope that Korea does not make the mistake of spending all the foreign income we earn through the export of semiconductor devices and display panels on the import of semiconductor display equipment and materials.
For more information, and to get involved in SEMI Standards activities in Korea, please contact Ms. Natalie Shim (firstname.lastname@example.org)