Samsung Electronics Co. Ltd. wants to challenge $10 billion Taiwan Semiconductor Manufacturing Co. Ltd. at the foundry game. Is Samsung serious? Should others take the company seriously?
I say yes, and yes.
And the reason is: When Samsung puts its corporate will to something, it slowly and surely executes. It may take years, but Samsung gets it done. Its very existence is a testament to South Korea's long-term strategic approach.
As a result Samsung is the world's second largest semiconductor maker. With sales of $20 billion in 2008 it was roughly twice as large as its nearest competitors, who include TSMC among their ranks.
In its aspiration to rival TSMC in foundry, Samsung is keeping faith with manufacturing in exactly the way that the likes of Texas Instruments, STMicroelectronics, Freescale and the old crowd of IDMs are not. In terms of leading-edge logic the world is polarizing into the fabless and the foundries. Those western IDMs are choosing to outsource their leading-edge CMOS logic manufacturing requirements to foundries. Samsung has chosen to be one of the makers that will pick up that business, and the evidence shows they can deliver.
Consider how Japanese chipmakers led the DRAM market in the 1980s. In 1990 Japan was responsible for 70 percent of the world's DRAM production but by 1995 the world's largest DRAM maker was Samsung with $6.4 billion sales and 16 percent market share.