Wikipedia source excerpts
rapid advances in fabrication technology leading to the exponential growth in semiconductor device production, known as Moore's law that has persisted over the past six or so decades. The industry's annual semiconductor sales revenue has since grown to over $481 billion, as of 2018.
In 2010, the semiconductor industry had the highest intensity of Research & Development in the EU and ranked second after Biotechnology in the EU, United States and Japan combined.
The semiconductor industry is in turn the driving force behind the wider electronics industry, with annual power electronics sales of £135 billion ($216 billion) as of 2011, annual consumer electronics sales expected to reach $2.9 trillion by 2020, tech industry sales expected to reach $5 trillion in 2019, and e-commerce with over $29 trillion in 2017. In 2019, 32.4% of the semiconductor market segment was for networks and communications devices.
In 2021, the sales of semiconductors reached a record $555.9 billion, up 26.2%, with sales in China reaching $192.5 billion, according to the Semiconductor Industry Association. A record 1.15 trillion semiconductor units were shipped in the calendar year.
pment in the EU and ranked second after Biotechnology in the EU, United States and Japan combined.
The semiconductor industry is in turn the driving force behind the wider electronics industry, with annual power electronics sales of £135 billion ($216 billion) as of 2011, annual consumer electronics sales expected to reach $2.9 trillion by 2020, tech industry sales expected to reach $5 trillion in 2019, and e-commerce with over $29 trillion in 2017. In 2019, 32.4% of the semiconductor market segment was for networks and communications devices.
In 2021, the sales of semiconductors reached a record $555.9 billion, up 26.2%, with sales in China reaching $192.5 billion, according to the Semiconductor Industry Association. A record 1.15 trillion semiconductor units were shipped in the calendar year.
Industry structure
The global semiconductor industry is dominated by companies from the United States, Taiwan, South Korea, Japan and the Netherlands, with Israel and Germany having significant presence in the field.
Unique features of the industry include continuous growth but in a cyclical pattern with high market fluctuation over the short run. While the current 20-year annual average growth of the semiconductor industry is on the order of 13%, this has been accompanied by equally above-average market volatility, which can lead to significant if not dramatic cyclical swings. This has required the need for high degrees of flexibility and innovation in order to constantly adjust to the rapid pace of change in the market as many products embedding semiconductor devices often have a very short life cycle.
At the same time, the rate of constant price-performance improvement in the semiconductor industry is staggering. As a consequence, changes in the semiconductor market not only occur extremely rapidly but also anticipate changes in industries evolving at a slower pace. The semiconductor industry is widely recognized as a key driver and technology enabler for the whole electronics value chain.
Prior to the 1980s, the semiconductor industry was vertically integrated. Semiconductor companies both designed and manufactured chips in their own facilities. In many cases, this included inventing new processes, refining and purifying source chemicals and silicon wafers, and even manufacturing equipment, like furnaces, lithography tools and etchers. These companies also carried out the assembly and testing of their chips. Over time, many of these functions were outsourced, such that today semiconductor manufacturers rely on a complex supply chain to provide wafers, high-purity source chemicals, and processing equipment. Further, starting with LSI in 1969, the industry has seen the emergence of Fabless Semiconductor Companies that focus solely on chip design and rely on other companies to manufacture their designs. Initially, these other companies were integrated device manufacturers (IDMs), companies that also designed and manufactured their own products, and thus were often competitors of the Fabless companies. But, by the mid-1980's TSMC and UMC emerged as foundries, specializing solely in the manufacture of other companies' designs.
Today, much of the industry is based on the foundry model, which consists of semiconductor fabrication plants (foundries) and integrated circuit design operations, each belonging to separate companies or subsidiaries. Some companies, known as integrated device manufacturers, both design and manufacture semiconductors. The foundry model has resulted in consolidation among foundries. As of 2021, only three firms are able to manufacture the most advanced semiconductors: TSMC of Taiwan, Samsung of South Korea, and Intel of the United States. Part of this is due to the high capital costs of building foundries. TSMC's latest factory, capable of fabricating 3 nm process semiconductors and completed in 2020, cost $19.5 billion.
Intel is considering outsourcing some production to TSMC. It currently can only produce 10 nm semiconductors, while TSMC and Samsung can both produce 5 nm.