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(LEAD) Samsung to invest 133 tln won by 2030 to expand non-memory, foundry biz

Industry 13:53 April 24, 2019

(ATTN: UPDATES with more details in para 10-19; ADD photos)
By Kim Eun-jung

SEOUL, April 24 (Yonhap)-- Samsung Electronics Co. said Wednesday it will invest 133 trillion won (US$115.7 billion) by 2030 to expand its non-memory and foundry business to take the top spot in the high-tech and lucrative sector.

The world's largest memory chip maker announced measures to develop the semiconductor ecosystem with increased investment for the foundry and non-memory segment to diversify its portfolio.

"The investment plan is expected to help the company reach its goal of becoming the world leader in not only memory semiconductors but also logic chips by 2030," Samsung said in a release. "The company also plans to create 15,000 jobs in R&D and production to bolster its technological prowess."

The investment will be composed of 73 trillion won for domestic R&D and 60 trillion won for production infrastructure, it said.

The tech giant said it will step up collaboration with small and medium-sized companies as well as universities and research labs to develop emerging technologies and train professionals in the industry.

Non-memory chips, also called system large-scale integration (LSI), comprise a broad range of semiconductor products, including processors, chipsets and image sensors.

According to global research firm Gartner, the value of the non-memory chip market was estimated at $346.6 billion last year -- 65 percent of the total -- more than twice that of the memory chip sector.

Foundry refers to the contract chip manufacturing business for fabless chip makers, such as U.S. tech behemoths Qualcomm and Broadcom, which design and sell semiconductors for various types of electronics.

The latest move also comes as the government has vowed to expand support for the semiconductor industry to reduce the nation's heavy reliance on the memory chip business and better fend off challenges by rising Chinese manufacturers.

Samsung Electronics Co.'s third-generation 10 nanometer-class DDR4 DRAM 8Gb is shown in this photo provided by the world's largest memory chip maker on March 23, 2019. (Yonhap)

Samsung has been actively promoting its latest nanometer fab technology based on extreme ultraviolet lithography (EUV), in hopes of catching up to Taiwan's TSMC, which holds an over 50 percent share of the global foundry market.

The nanometer measurement, which is a key metric in the semiconductor fabrication business, is an indicator of the space between transistors on a chip. The smaller the size, the more challenging and expensive the chips generally are to develop and deploy, leaving only a few companies available for clinching deals for advanced chips.

Last week, the company said the development of its 5-nanometer (nm) FinFET process technology is complete and now ready for customer samples. It said the EUV-based process will improve performance and energy efficiency over its previous 7-nm technique, which started mass production earlier this year.

Both Samsung and TSMC have been working on a 7-nm process node meant to serve as a foundation for the next generation of processors.

Samsung has been manufacturing chips for fabless companies, including U.S. chip giant Qualcomm and electric vehicle maker Tesla.

On Tuesday, Tesla gave its first, detailed glimpse of its new full self-driving chip designed by itself and manufactured in Samsung's fab in Austin, Texas.

Telsa claimed its latest chip offers much better performance than the Nvidia chips it was using before.

Some market watchers have also raised expectations Samsung may be a potential provider of 5G solution for Apple's iPhones, along with U.S. chip giant Qualcomm.

"We expect Apple will likely adopt 5G baseband chips made by Qualcomm (focus on mmWave markets) and Samsung (focus on Sub-6GHz markets) to lower supply risk, reducing costs and having better bargaining power," Ming-Chi Kuo, TF International Securities analyst, said in a note.

Samsung has been producing 5G solutions for the latest premium mobile devices, including the Galaxy S10 5G, as the company seeks to expand its presence in the next-generation wireless business.

This photo provided by Samsung Electronics Co. on April 16, 2019, shows its semiconductor production line in Hwaseong, south of Seoul. (Yonhap)

ejkim@yna.co.kr
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