Samsung had the most installed wafer capacity with nearly 1.9 million 200mm-equivalent wafers per month. That represented 12.6% of the world?s total capacity and most of it used for the fabrication of DRAM and flash memory devices. Next in line was the largest pure-play foundry in the world TSMC with about 1.5 million wafers per month capacity, or 10.0% of total worldwide capacity. Following TSMC were memory IC suppliers Micron, Toshiba/SanDisk, and SK Hynix.
In January 2013, Micron and Nanya amended their Inotera partnership such that Micron now takes 95% of Inotera's wafer output. Previously, Micron and Nanya evenly split Inotera's capacity. Then, in July 2013, Micron finally closed the deal on its acquisition of Elpida Memory and the Rexchip business in Taiwan that Elpida operated in partnership with Powerchip. It took Micron a full year to complete the purchase after several delays with getting approvals from bondholders and governments. With the addition of the Elpida and Rexchip fabs as well as the extra Inotera capacity, Micron became the third-largest wafer capacity holder in the world in 2013 with nearly 1.4 million 200mm-equivalent wafers per month (9.3% of total worldwide capacity). At the end of 2012, Micron had the sixth-largest amount of wafer capacity.
The fourth-largest capacity holder at the end of 2013 was Toshiba with a little under 1.2 million in monthly wafer capacity (8.0% of total worldwide capacity), including a substantial amount of flash memory capacity for joint-investor/partner SanDisk. After Toshiba came another memory IC supplier SK Hynix with a little more than one million wafers/month (7.0% of total worldwide capacity). Rounding out the top six companies was Intel with 961K 200mm-equivalent wafers per month capacity, or 6.5% of total worldwide capacity. Just two years ago in 2011, Intel was the third-largest capacity leader, but in early 2012 the company reduced its ownership position in IM Flash as well as its wafer output share from its joint venture with Micron.
The three largest pure-play foundries - TSMC, GlobalFoundries, and UMC - have held about 80% of the worldwide pure-play foundry market since 2010. Moreover, these three foundries had a combined capacity of about 2.5 million wafers per month as of December 2013, representing about 17% of the total fab capacity in the world.
IC manufacturing is increasingly becoming a high stakes poker game with enormous up-front costs. Today, it costs $4.0-$5.0 billion for a high-volume state-of-the-art 300mm wafer fab and the cost to build tomorrow's 450mm wafer fab will probably be double that. Despite the cost-per-unit area advantage that larger wafers provide, the number of companies willing and able to continue investing that much is decreasing.
IC Insights believes that the capacity shares of the top 5, 10, 15, and 25 leaders will continue to increase over the next several years as the big get bigger, middle-tier manufacturers merge to consolidate resources and improve competitiveness, and a greater number of mid- to small-size companies move away from in-house IC fabrication and move toward using third-party foundries.
Rankings of IC manufacturers by installed capacity for each of the wafer sizes are shown below. Looking at the ranking for 300mm wafer capacity, it is not surprising that the list includes only DRAM and flash memory suppliers like Samsung, Toshiba, Micron, SK Hynix, and Nanya; the industry's biggest IC manufacturer and dominant MPU supplier Intel; and the world's three largest pure-play foundries TSMC, GlobalFoundries, and UMC. These companies offer the types of ICs that benefit most from using the largest wafer size available to best amortize the manufacturing cost per die. The ranking for the smaller wafer sizes (i.e., ≤150mm) includes a more diversified group of companies.
A significant trend with regard to the industry's IC manufacturing base, and a worrisome one from the perspective of companies that supply equipment and materials to chip makers, is that as the industry moves IC fabrication onto larger wafers in bigger fabs, the group of IC manufacturers continues to shrink in number. There are just 36% the number of companies that own and operate 300mm wafer fabs than 200mm fabs and the distribution of worldwide 300mm wafer capacity among those manufacturers is very top-heavy. Essentially, there are only about 15 companies that comprise the entire future total available market (TAM) for leading-edge IC fabrication equipment and materials. When 450mm wafer fabrication technology comes into production, this manufacturer group is predicted to shrink even further to a maximum of just 10 companies.