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| A worker at Gaonchips, Samsung's local partner, left, is involved in the chip-designing process with the help of a Samsung Electronics employee using the SAFE platform, Thursday. Courtesy of Samsung Electronics |
By Kim Yoo-chul
After Samsung Electronics outlined its aim to spend a whopping 133 trillion won ($116 billion) in complicated logic gate chip production to better compete with Taiwan's TSMC and Intel, the main focus is on the character of the investment and Samsung's role in moving forward with its local suppliers.
Samsung has long been a global leader in memory chips, but because the chips market position is being compromised due to the massive influx of cheap products from Chinese firms, Samsung is shifting its focus to logic gate chip making by teaming up with major clients on designing and manufacturing custom chips. That work is starting to "add to" Samsung's chip revenue, though the size of the contribution isn't substantial "for the time being," the company says.
No matter how important its logic gate chip blueprint, it can't expect to substantially expand that business without the support and collaboration of its domestic suppliers, Samsung said.
Samsung spokesman Luke Cho said the company is "fully aware of the significance of the creation of the ecosystem and why it matters." In line with that perspective, Samsung said Thursday it has launched a cloud-based design platform for small domestic "fabless chip firms" ― those that do not have fabrication facilities.
Specifically, Samsung introduced the Samsung Advanced Foundry Ecosystem (SAFE) Cloud Design Platform. That is the result of a partnership with Rescale, a leading high-performance computing solutions provider, Samsung said.
Samsung said the platform will help customers reduce spending on building their own server infrastructure and give them access to the Samsung foundry system including patents and chip designing.
Thursday's announcement came after President Moon Jae-in and his Cheong Wa Dae economic team stressed South Korea's need to lead in advanced components after Japan's decision to remove South Korea from its list of most preferred trading partners.
President Moon visited Samsung's chip and display facilities, a move widely interpreted by many as Moon's expectation of Samsung's role in expanding South Korea's presence in sectors crucial to the country's manufacturing industries.
Samsung said it plans to mass produce "various products" relevant to logic gate chips in collaboration with local partners. The significance of logic gate chip making is clear ― tech giants from Apple and Google to Amazon are designing their own chips with the aim of optimizing many tasks involving artificial intelligence (AI) and server performance to lengthening battery life.
Samsung's rather risky bid to move beyond its already established business of producing silicon wafers and to catch up on the existing leaders in the contract chip-making industry is expected to be backed by its massive extreme ultraviolet (EUV) plant being built in Hwaseong, just outside Seoul.
Taiwan's TSMC is still dominating the logic gate chip market with about half, followed by Samsung with below 20 percent.
Samsung officials contacted by The Korea Times said the company's continuous outreach to the contract chip-making business is not an issue of commitment as it is the market and trend that Samsung cannot afford to miss out on.
They also said the sector will need extensive support from partners and the government.
While it seems fair to say that Samsung is on the right track toward expanding its position in the logic gate chip-making industry, it is increasingly being asked to address "some worries" from clients that its logic-chip business unit may become a potential competitor.
