SCRPT090807508415

Abstract
The decline of the global IC market also affected China's
semiconductor industry in 2008. The country's IC
manufacturing and packaging and testing industries
experienced declines in 2008, while the IC design industry
managed to achieve slight growth. This report examines
China's IC market scale, as well as the IC design, IC
manufacturing and IC packaging and testing industries in
China. The report analyzes the historical development of
each of these industries, as well as industry clusters and key
companies in each industry.

by China Research Team




Semiconductor
Current Status of China's
Semiconductor Sector:
Market Scale, Industry
Development, Key
Companies
Document Code: SCRPT090807508415
Publication Date: September 2009
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Current Status of China's Semiconductor Sector: Market Scale, Industry Development, Key Companies _________ i
2009 Market Intelligence & Consulting Institute September 2009
SCRPT090807508415
Table of Contents

Page

1. China's IC Market ...................................................................................... 1
1.1 Market Scale .......................................................................................... 1
1.2 Competition Status .............................................................................. 1
2. China's IC Design Industry ...................................................................... 2
2.1 Development History .......................................................................... 2
2.2 Industry Scale ....................................................................................... 4
2.3 Industry Clusters ................................................................................. 5
2.4 Key Companies .................................................................................... 6
3. China's IC Manufacturing Industry ........................................................ 7
3.1 Development History .......................................................................... 7
3.2 Industry Scale ....................................................................................... 8
3.3 Industry Clusters ................................................................................. 9
3.4 Key Companies .................................................................................. 10
4. China's IC Packaging and Testing Industry ........................................ 13
4.1 Development History ........................................................................ 13
4.2 Industry Scale ..................................................................................... 15
4.3 Industry Clusters ............................................................................... 16
4.4 Key Companies .................................................................................. 17
Appendix ....................................................................................................... 19

ii _________________________________________________________ Industry Intelligence Program - Semiconductor
September 2009 2009 Market Intelligence & Consulting Institute
SCRPT090807508415
List of Figures

Page

Figure 1 China IC Market Scale, 2006 - 2011 ........................................... 1
Figure 2 China's IC Design Industry Scale, 2004 - 2008 ........................ 5
Figure 3 China's IC Manufacturing Industry Scale, 2004 - 2008 .......... 9
Figure 4 China's IC Packaging and Testing Industry Scale, 2004 -
2008 .............................................................................................. 16

Current Status of China's Semiconductor Sector: Market Scale, Industry Development, Key Companies ________ iii
2009 Market Intelligence & Consulting Institute September 2009
SCRPT090807508415
List of Tables

Page

Table 1 Top 10 Companies in China's IC Market, 2008 ......................... 2
Table 2 Development Phases of China's IC Design Sector ................... 3
Table 3 Key Events in China's IC Design Sector, 2008 - 2009 ............... 4
Table 4 China IC Design Industry Clusters ............................................ 6
Table 5 Top 10 IC Design Companies in China, 2008 ............................ 7
Table 6 Development Phases of China's IC Manufacturing Sector ..... 7
Table 7 Key Events in China's IC Manufacturing Sector, 2008 -
2009 .................................................................................................. 8
Table 8 China IC Manufacturing Industry Clusters ............................ 10
Table 9 Top 10 IC Manufacturing Companies in China, 2008 ........... 11
Table 10 12-inch Production Lines in China ......................................... 11
Table 11 8-inch Production Lines in China ........................................... 12
Table 12 6-inch Production Lines in China ........................................... 13
Table 13 Development Phases of China's IC Packaging and
Testing Sector ............................................................................. 14
Table 14 Key Events in China's IC Packaging and Testing Sector,
2008 - 2009 ................................................................................... 15
Table 15 China IC Packaging and Testing Industry Clusters ............ 17
Table 16 Top 10 IC Packaging and Testing Companies in China,
2008 .............................................................................................. 18

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September 2009 2009 Market Intelligence & Consulting Institute
SCRPT090807508415
desktop PC and notebook PC chips, Intel was able to
maintain the leading position in the market. Samsung
and Hynix mainly relied on memory products to
occupy the second and third spot in the 2008 rankings.
Mediatek benefited from the growth in the mobile
phone market, and the company's growth rate reached
11.3% in 2008.


Table 1 Top 10 Companies in China's IC Market, 2008
Company
Revenue
(Unit: 100 Million RMB)
Growth Rate Market Share
Intel 1,081.2 11.8% 18.1%
Samsung 364.4 1.2% 6.1%
Hynix 238.9 -9.6% 4.0%
TI 233.0 3.6% 3.9%
Toshiba 227.0 0.9% 3.8%
AMD 227.0 9.1% 3.8%
STMicro 203.1 12.9% 3.4%
NXP 179.2 -3.4% 3.0%
Freescale 161.3 6.2% 2.7%
Mediatek 131.4 11.3% 2.2%
Others 2,926.9 6.9% 49.0%
Note: US$1=6.83 RMB
Source: China's Ministry of Industry and Information Technology, compiled by MIC, May 2009


2. China's IC Design Industry
2.1 Development History
Since the establishment of the first IC design company
in China in 1986, the industry has passed through an
initial development period and a rapid growth period,
and is currently in a stage of adjustment.

The industry's initial development phase lasted from
1986 to 1999. The Chinese government's policies for the
IC design industry mainly consisted of the 908 and 909
projects.

The industry's rapid growth period lasted from 2000 to
2004. Chinese IC design companies primarily benefited
from the "no.18 document" issued by the government
in 1999. This policy document encouraged overseas
students to return to China and set up enterprises and
system companies to integrate upstream activities. This
caused the number of Chinese IC design companies to
increase to 500.





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The second-most important region is the Bohai Sea
region featuring the Beijing-Tianjin corridor. A key
advantage for this region is the availability of talented
technology engineers from Beijing. Companies
operating in this region include Datang
Microelectronics Technology, CEC Huada Electronic
Design (HED), and Vimicro.


Table 4 China IC Design Industry Clusters
Region
Share of Industry's
Total Production Value
Key Companies
Yangzi River Delta
35.7% Semico, Huahong, Spreadtrum, Silan
Microelectronics
Bohai Sea
Beijing / Tianjin
31.0%
Datang Microelectronics Technology,
CEC Huada Electronic Design (HED),
Vimicro, Tongfang Microelectronics
Pearl River Delta 20.6%
Hisilicon, Actions Semiconductor,
Anyka
Central and Western
Regions and Others
12.8%
Chengdu Sino Microelectronics
System, Panovasic, Huaxun
Microelectronics
Source: MIC, May 2009


2.4 Key Companies
The ranking of the top ten IC design companies in
China in 2008 showed large differences compared to
2007.

HiSilicon obtained Huawei orders and it aggressively
developed the STB (Set Top Box) market. The company
experienced growth of 139.8% in 2008, becoming the
first Chinese IC design company to surpass three
billion RMB (US$439.2 million) in revenue.

IC card suppliers experienced revenue declines, in
particular companies that focused on the IC market for
second-generation ID cards in China, such as China
Huada Integrated Circuit Design, Datang
Microelectronics Technology, Huahong, and Tongfang
Microelectronics.

Revenues of companies that emerged from the digital
electronics product market, such as Actions
Semiconductor and Vimicro, also declined. Revenue of
Actions Semiconductor fell 23%. The main reason for




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Current Status of China's Semiconductor Sector: Market Scale, Industry Development, Key Companies _________ 7
2009 Market Intelligence & Consulting Institute September 2009
SCRPT090807508415
the decline was the slowdown in growth in the MP3
chip market, causing fierce competition and rapid
price declines. Vimicro suffered from similar price
competition trends in the camera module chip market,
leading to a revenue decline of 12.4% for the company.


Table 5
Top 10 IC Design Companies in China, 2008
Ranking Company
Sales Revenue
(Unit: 100 Million RMB) Growth Rate
2008 2007
1 Hisilicon 30.9 12.9 139.8%
2
China Huada Integrated Circuit
Design
14.4 14.6 -1.2%
3 Spreadtrum 8.9 11.1 -19.7%
4 Datang Microelectronics Technology 8.4 10.8 -22.5%
5 Silan Microelectronics 8.1 8.2 -1.2%
6 Actions Semiconductor 6.8 8.8 -23.0%
7 Semico 6.2 8.5 -26.6%
8 Huahong 6.1 6.8 -9.7%
9 Vimicro 6.2 7.1 -12.4%
10 Tongfang Microelectronics 4.0 4.6 -13.7%
Note: US$1=6.83 RMB
Source: CSIA, compiled by MIC, May 2009


3. China's IC Manufacturing Industry
3.1 Development History
In terms of business models, the Chinese IC
manufacturing industry has gone through two
development phases: IDM (Integrated Design
Manufacturing) and foundry.


Table 6
Development Phases of China's IC Manufacturing Sector
Development
Phases
Key Events Industry Environment
IDM
China Huajing Electronics,
Shougang NEC Electronics,
Shanghai Belling, Huahong were
established
Chinese government promotes
908 and 909 projects; key
enterprises are China Huajing
Electronics and Huahong
Foundry
In 1995, ASMC transformed to
foundry
SMIC established in 2000
Chinese government issues
"no.18 document" encouraging
the development of the IC
industry
Source: MIC, May 2009




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Current Status of China's Semiconductor Sector: Market Scale, Industry Development, Key Companies ________ 19
2009 Market Intelligence & Consulting Institute September 2009
SCRPT090807508415
Appendix
List of Companies

Actions Semiconductor

Alphatec

AMD
Amkor

Amlogic
Anadigics
ANST

Ansun Semiconductor

Anyka

Aptina
ASE
ASMC (Advanced Semiconductor
Manufacturing Corporation)

BCD Semiconductor

Blue Rocket Electronics

Brite Semiconductor
CEC Huada Electronic Design
(HED)

Changjiang Technology

Chengdu Sino Microelectronics
System

China Huada Integrated Circuit
Design
IC
China Huajing Electronics

China Nanker

China Resources Microelectronics

ChipMOS

Chipnuts

ChipPAC

CSMC Technologies

Cypress
Datang Microelectronics
Technology

Datang Telecom

Elpida
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FlipChip
Founder Microelectronics

Freescale
Fujitsu
Fushun Semiconductor
Manufacturing

G.M.I Technology
GSMC

GTBF (Great Team Backend
Foundry)

HeJian Technology

Hisilicon

Hitachi
Honor Trust Technology
Huahong

Huahong NEC
Huatian Corporation

Huawei

Huaxun Microelectronics

Hynix
Hynix-Numonyx
Hyundai
IBM
IC Spectrum

Infineon (Wuxi)
Innofidei
Intel
Jinan Jingheng

King Yuan Electronics

Lingsen

LRC (Leshan Radio Company)

Mediatek

Micron (Xi'an)
Microsilicon Technology
Minhang Electronics

Mitsubishi
Current Status of China's Semiconductor Sector: Market Scale, Industry Development, Key Companies ________ 21
2009 Market Intelligence & Consulting Institute September 2009
SCRPT090807508415
Motorola
MPS
National Semiconductor
NEC
NXP
Opte Optoelectronic
Panasonic
Panovasic

Philips
Power Analog Microelectronics

Prima

PSI
Qimonda (Suzhou)
Quorum System
Renesas
RFMD
Ritu
Samsung
Samtest (Suzhou) Technology

Semico

Shanghai Belling

Shenchao

Shenzhen STS Microelectronics

Shougang NEC Electronics

Silan Microelectronics

Silicon Image
Silterra
Sino Microelectronics

SinoMOS

SMIC

Spansion
Spil

Spreadtrum

STMicro
T3G

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September 2009 2009 Market Intelligence & Consulting Institute
SCRPT090807508415
Technology Semiconductor Limited
in Shenyang (TSLS)

TI
Tongfang Microelectronics

Toshiba
TSMC (Shanghai)
UMC

Vimicro

Wujiang Mightytek Semiconductor
Xi'an Xiyue Electronics Technology
Co.,

Xinchao Group







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