Competitive substitution and technological diffusion for semiconductor foundry firms

摘要

To survive in an intensively competitive environment, semiconductor companies need to be more agile, responsive, and flexible than before. Generally, semiconductor industry consists of three business models: integrated design manufacturer, fabless chip design, and foundry business. In general, semiconductor firms are affected by three drivers: new entrants and rivals (competition), main customers (demand), and process technologies (R&D). Inspired by Michael Porter's five-force analysis, a novel framework is presented to accomplish the following goals: (1) The interactions between the top three foundry firms, TSMC, Samsung, and Global Foundries, are analyzed to reveal managerial insights, (2) The main customers of TSMC including Apple, Huawei, Qualcomm, Mediatek, AMD, and NVidia are incorporated to into sales forecasting, and (3) Technological diffusion across the mature process (above 70 nm), the medium process (between 20 nm and 70 nm), and the advanced process (below 20 nm) is captured to predict sales revenues. Key findings are shown as follows: (1) a large-scale foundry frim benefits from the existence of a small-scale firm, (2) the inclusion of main customers significantly improves the performance of sales forecasting, (3) the advanced process gradually benefits from the mature process while it rapidly replaces the medium process in a "predator-prey" way.