Taiwan Semiconductor Industry to Benefit from Apple's Purchases of IC Chipsets in Q3

Jul 22, 2011 Ι Industry In-Focus Ι Electronics and Computers Ι By Steve Chuang, CENS
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Taipei, July 22, 2011 (CENS)--Growingly worried about growth slowdowns, Taiwan's semiconductor industry still sees a ray of light, as Apple Inc. will purchase IC chipsets for use in its upcoming Macbook Air, iPhone 4S and iPad 3 starting at the end of August, which will surely benefit the industry in the third quarter of this year.

The mounting European debt crisis along with weak economy and the growing dispute over the debt ceiling in the U.S. has dampened market demand for electronic products such as smartphones and tablet PCs recently, causing insiders to widely take a pessimistic view of the industry in the third quarter of this year, despite seasonal booms.

Downstream customers' lackluster shipments have also worried Taiwan's semiconductor firms, as Taiwan Semiconductor Manufacturing Co., Ltd. (TSMC) and United Microelectronics Corp., the top two wafer foundries. Both firms have forecast sluggish growths of wafer shipments, while testing and packaging companies have also been forced to cut their shipment growth projections for the third quarter of this year.

However, Apple's plan to procure IC chipsets for use in Macbook Air, iPhone 4S and iPad3 starting at the end of August has shined a light of hopes to the gloomy industry, indicated market observers. They added that Apple has worked out technical specifications for the IC chipsets and related certification process, and allegedly placed orders with its suppliers.

Although only a few Taiwanese suppliers in the semiconductor industry directly tap Apple's supply chain presently, some are still likely to enjoy a share of the business chance through contract manufacturing.

For example, Qualcomm, the major supplier of handset IC chips for Apple, is expected to place its contract orders for chip foundry and testing and packaging with TSMC and Advanced Semiconductor Engineering Inc., respectively, starting in August or September before iPhone 4S lands in the market.

Also, Taiwanese chip packagers are upbeat with the upcoming launch of iPad 3, with Chipbond Technology Inc., believed to garner orders from Japan's Renesas Electronics Corp., Apple's supplier of LCD drive ICs, and Ardentek Corp., to receive orders from Texas Instruments, the power management IC supplier.

Compared to their Taiwanese peers, a few chip suppliers, however, can directly seize the business chance generated by Apple's Macbook Air, including Realtek Semiconductor Corp. (Ethernet chips), Macronix International Co. (nor flash memory for BIOS), Skyworth Group Co. (card reader chips) and Richtek Technology Corp. (power management chips).
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