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SMIC Down, Chartered Up In Foundry Rankings

The pure-play foundry market is forecast to surge 22 percent in 2006, but the Chinese providers will see their explosive growth slow amid major changes in the projected rankings this year, according to IC Insights Inc.
MANHASSET, N.Y. — The pure-play foundry market is forecast to surge 22 percent in 2006, but the Chinese providers will see their explosive growth slow amid major changes in the projected rankings this year, according to IC Insights Inc. The projected rankings table is here.

According to IC Insights (Scottsdale, Ariz.), nine of the top 10 pure-play foundry companies reside in the Asia-Pacific region. Germany's X-Fab Semiconductor Foundries AG, which acquired Malaysia's 1st Silicon (Malaysia) Sdn. Bhd., is the only non-Asia-Pacific company.

The report noted that TSMC, UMC, Chartered, and SMIC continue to dominate the foundry market with an 84 percent global share between them. Perennial market leader and powerhouse Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) alone is expected to register sales of greater than $10 billion in 2006 and maintain a 50 percent market share.

In the projected rankings, rival United Microelectronics Corp. (UMC) of Taiwan is expected to remain in second place in terms of sales for 2006.

Singapore's Chartered Semiconductor Manufacturing Pte. Ltd. is projected to climb from fourth to third among foundries in 2006, which IC Insights attributes to establishing key alliances with companies such as IBM. Chartered is ramping MPU shipments for AMD and increasing its output of video game processors for Microsoft's X-box machines.

Chartered's growth comes at the expense of China's Semiconductor Manufacturing International Corp. (SMIC), which is projected to fall from third to fourth in the rankings for 2006, according to the research firm.

Korea's Dongbu is projected to be in fifth place in the overall foundry rankings for 2006, followed in order by Taiwan's Vanguard, China's HHNEC, Singapore's SSMC, China's He Jian, and X-Fab.

Four of the top 10 foundries reside in China, with Chinese foundries comprising 12.4 percent of the market in 2005, up from 4 percent in 2002. However, IC Insights forecasts Chinese foundries will increase their 2006 market share only slightly to 12.6 percent, as the foundries have moved from the explosive startup growth phase to more moderate rates typical of established companies.

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