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Trends and Outlook of Korea’s Semiconductor Industry
With rising demand for artificial intelligence and big data analysis, the industry, driven mainly by the memory semiconductor business, is predicted to show steep growth reaching an annual average growth rate of 6.4 percent by 2021. The market for NAND Flash is expected to grow 12.2 percent. Automotive/industrial semiconductor vendors will also benefit from a surge in demand of over 10 percent annually, whereas the growth trajectory in telecommunications/ data-processing seems to remain at the status quo. Fabless manufacturing, which is the design and sale of system semiconductor chips, keeps showing a steady growth (taking up over 20 percent of the market) and the same trend is found in the market for the IP cores.
In the coming decades, artificial intelligence (AI) will become the next game-changer, transforming every corner of our life; the way we live, the way we work and the way we earn money thanks to emerging technologies such as self-driving cars, intelligent robots, bio/healthcare devices and Internet of Things (IoT). Automation and digital connectivity brought by these highly advanced technologies appear to result in even fiercer competition to make semiconductor products more efficient, compact, smarter and lighter while consuming less energy.
To meet the demand of our times, facing a new era of artificial intelligence in the 4th industrial revolution, Korea has long been working on catching up and further advancing its technology. As of 2018, the total output of the semiconductor industry in Korea amounted to USD 109.1 billion. The largest part of the revenue came from memory chips that accounts for almost 93 percent (or USD 101.6 billion) of the total.
Korea, highly competent in processing technology and ready to make swift decisions for future investment takes up over half of overall global market value. Being part of world’s technological frontier, Korea is keeping distance from follower countries to remain competitive. Korea, which occupies over 63 percent of the world’s memory chips market, has a lead in DRAM (72.3 percent) and NAND (49.5 percent) business.
*Source : IHS 19.March
Technically, semiconductor producers in Korea are further advancing new technologies and processing platforms that include nanoscale materials (e.g. nanocrystal), high speed semiconductor devices utilizing semiconductor materials and Low k ultra-thin films based upon RF plasma polymerized aniline.
With the implementation of a new processing system that covers both microfabrication (through the steps of pre-processing to miniaturize structures into microscale) and the fan-Out Wafer Level Package at the post-processing (FlWLP) stage, these semiconductor manufacturers have started to well appreciate the technologies for processing, equipment/facilities and raw materials.
Putting greater efforts into advancing microfabrication in the memory semiconductor industry, they began to establish a new production base near suburban areas to serve as the world’s biggest semiconductor clusters.
By securing original technology formidable enough to beat the current fad, the intelligent semiconductor transformer (IST), in its performance or in energy consumption level, Korea is now planning to take a leadership role in the future market for CMOS + materials based super intelligence image sensors and ultra-energy efficient IST, while leapfrogging over technology powerhouses through further improved IST architecture engineering, a key to AI/ Nano-processors.
Based upon next generation intelligent semiconductor technology, major players in Korea will become more competent in the Fabless industry, continuing to develop emerging technologies to be commercially viable-unmanned mobility, augmented reality, big data- mobile, high-tech robotic engineering, bio/ healthcare, energy, so-called “smarter consumer electronic products (that digitally talk to one another in a household network)” and “smart cities”—all of which require advanced semiconductors as inputs.
Consistent enhancements of prior technologies in the assembly lines enabling small businesses involved to become global pacesetters, in addition to the preoccupation of intellectual property for new technologies will help them widen the technology gap with followers like China.
These semiconductor giants in Korea will form a closer collaborative network with market suppliers, ensuring that all the entities engaged, small or large, can secure three main technologies (architecture, materials, fabrication) to embrace a win-win ecosystem, where next generation intelligent semiconductor technologies can emerge from. With a vast pool of M.A. or Ph.D. level engineers, they’ll run academia-led pilot study projects through which Korea can make a swift move to secure IST core technologies in advance.
Date
2019.11.27
The world’s semiconductor sales revenue has grown exponentially from USD 292.5 billion in 2016 to USD 410.4 billion in 2018, and the industry seems to be maintaining its strong growth. By 2023, the market value is forecast to increase to USD 446.9 billion.
With rising demand for artificial intelligence and big data analysis, the industry, driven mainly by the memory semiconductor business, is predicted to show steep growth reaching an annual average growth rate of 6.4 percent by 2021. The market for NAND Flash is expected to grow 12.2 percent. Automotive/industrial semiconductor vendors will also benefit from a surge in demand of over 10 percent annually, whereas the growth trajectory in telecommunications/ data-processing seems to remain at the status quo. Fabless manufacturing, which is the design and sale of system semiconductor chips, keeps showing a steady growth (taking up over 20 percent of the market) and the same trend is found in the market for the IP cores.
In the coming decades, artificial intelligence (AI) will become the next game-changer, transforming every corner of our life; the way we live, the way we work and the way we earn money thanks to emerging technologies such as self-driving cars, intelligent robots, bio/healthcare devices and Internet of Things (IoT). Automation and digital connectivity brought by these highly advanced technologies appear to result in even fiercer competition to make semiconductor products more efficient, compact, smarter and lighter while consuming less energy.
To meet the demand of our times, facing a new era of artificial intelligence in the 4th industrial revolution, Korea has long been working on catching up and further advancing its technology. As of 2018, the total output of the semiconductor industry in Korea amounted to USD 109.1 billion. The largest part of the revenue came from memory chips that accounts for almost 93 percent (or USD 101.6 billion) of the total.
Korea, highly competent in processing technology and ready to make swift decisions for future investment takes up over half of overall global market value. Being part of world’s technological frontier, Korea is keeping distance from follower countries to remain competitive. Korea, which occupies over 63 percent of the world’s memory chips market, has a lead in DRAM (72.3 percent) and NAND (49.5 percent) business.
<Table 1> Semiconductor market size in Korea
(Unit: 1 million / USD)
| Category | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|---|---|---|---|
| Memory Semiconductor | 47,059 | 80,048 | 101,618 | 82,741 | 86,011 | 91,446 | 97,265 | 99,292 |
| (Share) | 88 | 92 | 93 | 95 | 92 | 92 | 92 | 93 |
| System Semiconductor | 6,394 | 6,840 | 7,544 | 4,167 | 7,158 | 8,141 | 8,615 | 8,043 |
| (Share) | 12 | 8 | 7 | 5 | 8 | 8 | 8 | 7 |
| Total | 53,453 | 86,888 | 109,162 | 86,908 | 93,169 | 99,587 | 105,880 | 107,335 |
Korea is the second largest semiconductor producer (taking up 21.5 percent of the market share) behind the United States and spends the most for semiconductor manufacturing equipment (USD 34.5 billion in 2017).
(Korea's semiconductor industry) a main driver of national economic growth: Total output 6.7%('16), employment 165,000('17), GDP share 3.46%('16), Export volume USD 97.9 billion('17)
- One of Korea's flagship industries, creating jobs and investment opportunities in the midst of economic slowdown.
< Chart 1> Trends and outlook of Korea's semiconductor industry
Technically, semiconductor producers in Korea are further advancing new technologies and processing platforms that include nanoscale materials (e.g. nanocrystal), high speed semiconductor devices utilizing semiconductor materials and Low k ultra-thin films based upon RF plasma polymerized aniline.
With the implementation of a new processing system that covers both microfabrication (through the steps of pre-processing to miniaturize structures into microscale) and the fan-Out Wafer Level Package at the post-processing (FlWLP) stage, these semiconductor manufacturers have started to well appreciate the technologies for processing, equipment/facilities and raw materials.
Putting greater efforts into advancing microfabrication in the memory semiconductor industry, they began to establish a new production base near suburban areas to serve as the world’s biggest semiconductor clusters.
By securing original technology formidable enough to beat the current fad, the intelligent semiconductor transformer (IST), in its performance or in energy consumption level, Korea is now planning to take a leadership role in the future market for CMOS + materials based super intelligence image sensors and ultra-energy efficient IST, while leapfrogging over technology powerhouses through further improved IST architecture engineering, a key to AI/ Nano-processors.
Based upon next generation intelligent semiconductor technology, major players in Korea will become more competent in the Fabless industry, continuing to develop emerging technologies to be commercially viable-unmanned mobility, augmented reality, big data- mobile, high-tech robotic engineering, bio/ healthcare, energy, so-called “smarter consumer electronic products (that digitally talk to one another in a household network)” and “smart cities”—all of which require advanced semiconductors as inputs.
Consistent enhancements of prior technologies in the assembly lines enabling small businesses involved to become global pacesetters, in addition to the preoccupation of intellectual property for new technologies will help them widen the technology gap with followers like China.
These semiconductor giants in Korea will form a closer collaborative network with market suppliers, ensuring that all the entities engaged, small or large, can secure three main technologies (architecture, materials, fabrication) to embrace a win-win ecosystem, where next generation intelligent semiconductor technologies can emerge from. With a vast pool of M.A. or Ph.D. level engineers, they’ll run academia-led pilot study projects through which Korea can make a swift move to secure IST core technologies in advance.
By An Ki-hyun,Director (khahn2@ksia.or.kr)
Korea Semiconductor Industry Association
< *The opinions expressed in this article are the author’s own and do not reflect the views of KOTRA. >