Borel's European chip industry proposal in full

The above figure 1 gives the comparison of total foundry market versus total IC market showing the increased contribution of a dedicated foundry (TSMC) to the dedicated foundry market growth.

Figure 2 gives foundry revenue relative to total IC revenue (A) for foundries and (B) for finished products revenues from wafers coming from foundry wafers.

An estimated ratio of 2.5 is given between finished product revenue from wafer foundry silicon (foundry business) versus foundry wafers revenue generating these products (IDM business).

This clearly shows a potential upside for foundry revenue of 2.5X if they decide to move to product design and capture the whole semiconductor market, performing product design and library design in low cost countries associated with significant margins.

Another interesting trend of foundries forecasted business evolution is described below (figure 3). Most of their business is today done in logic where they can be competitive without too much investment in advanced critical process steps.

They also clearly state their willingness to develop their business in higher value processes (analog, image sensors, microprocessors…) with higher margins, a path to access the overall semiconductor market.

This trend is already depicted in their present technology offering (see the case of TSMC in green on figure 4).