Is it right or left or in a dilemma?

In any case, TSMC has become the "golden master" in the global strengthening of the semiconductor arms race. In the face of the olive branch thrown by the United States, Japan, Europe, etc., TSMC has either passively or actively embarked on the pace of expansion, and this pace is not limited to wafer manufacturing. This time Japan has spared no effort to allow TSMC to fully "set up" in the fields of materials, manufacturing, packaging and testing. Is Japan really going to change its fate?

Cast the net

As the global semiconductor industry is reshaping, Japan, as a powerful player in the semiconductor industry, is also actively strengthening its own semiconductor industry chain. Last year, it set up a fund of 200 billion yen (approximately RMB 11.8 billion) to expand semiconductors, etc. At the same time, we try to attract overseas companies to research, develop, and produce jointly with Japan.

And TSMC can be described as the "top priority" of Japan's semiconductor plan. With continuous mediation, TSMC's layout in Japan is already in full swing.

It was reported in February that TSMC said it would spend approximately US$178 million to open a materials research subsidiary near Tokyo.

On May 31, the Ministry of Economy, Trade and Industry of Japan announced that it would support TSMC to set up a chip research and development center in Japan. The research and development center will invest 37 billion yen, and the Japanese government will pay half of it. Japan’s Sankei Shimbun disclosed that Japan’s leading material manufacturer Asahi Kasei, carrier board suppliers IBIDEN, JSR and equipment manufacturers Keyence, DISCO, Japan’s Institute of Advanced Industrial Science and Technology, and the University of Tokyo will participate in the cooperation with TSMC Cooperation.

According to previous reports and analysis by Jiwei reporters, this chip R&D center is targeting advanced packaging, TSMC provides packaging technology application scenarios, and Japan provides materials and equipment support.

Not only materials and packaging and testing, Japan also has a deeper plan under the big game of strengthening the manufacturing reflow of the semiconductor industry in various countries. According to recent news from Japanese media, under the leadership of the Ministry of Economy, Trade and Industry of Japan, TSMC may cooperate with Sony to build a front-end engineering factory in Japan. The total investment will reach 1 trillion yen (approximately RMB 58.2 billion). Whether it will land or not will depend on whether the Japanese government increases investment. Moreover, in the future, a post-engineering factory such as packaging will be established in this area.

It can be seen that Japan strongly invites TSMC to "bet" on Japanese materials, manufacturing, and packaging and testing, and is also full of sincerity in capital investment, and it is a big game.

Meaningful?

As the "protagonist" of multi-party cooperation, TSMC's intensive operation is actually very meaningful.

As pointed out by well-known experts, although TSMC’s current scenery is boundless, the crisis is not only how to maintain its “leading” technically. It will sooner or later hit a wall to rely on size reduction to dominate. At the same time, it is still in the vortex of the game of great powers. TSMC also has strong points. With a sense of crisis, choosing to cooperate with Japan, which has advantages in equipment and materials, can be described as a strong alliance.

For TSMC, this is also a good step to optimize the supply chain. Zeng Mengbin, Chief Executive Officer of Isaiah Research, mentioned that TSMC may establish a R&D center and back-end packaging and testing plant in Japan, and cooperate with the Japanese government and enterprises. Since Japanese companies are major suppliers of wafer materials, and Taiwan’s self-sufficiency rate in materials is relatively low, TSMC can use this to establish cooperative relations with key material suppliers to ensure upstream supply.

Han Xiaomin, general manager of Aiji Micro Consulting, also said that Japan itself is a powerhouse of semiconductor materials, occupying half of the world in the field of semiconductor materials, and even seeking defeat in many subdivisions. The development of advanced semiconductor manufacturing processes and advanced packaging processes has increasingly relied on the advancement of materials technology. TSMC’s active deployment in Japan is also a wise choice for itself to take advantage of Japan’s technological advantages in the field of materials.

At the advanced packaging and testing level, which is one of the disruptive technologies in the post-Moor era, TSMC has already deployed and intensively cultivated for many years. It is also the best policy to cooperate with Japanese companies to expand the circle of friends. According to Zeng Mengbin’s analysis, in the back-end packaging and testing part, the focus of factory building will be advanced packages such as InFO, SoIC, and CoWoS. The products may be related to HPC, AI, and automotive, and are highly likely to be related to Sony, Renesas, Toshiba, and Toshiba. Fujitsu and other Japanese customers work closely together.

Japan's "hidden pain"?

Undoubtedly, behind the big fanfare, Japan has shown its ambition to revive under the reshaping of the global semiconductor supply chain.

Japan once created a glorious history, but since the United States has imposed multi-pronged sanctions on the Japanese semiconductor industry, everything has been blown away by rain and wind. Its market influence and share have begun to decline sharply. In addition, it has missed PCs and mobile phones. With the development opportunities in the Internet era and the gradual inability of the semiconductor globalization division of labor system, the development of Japan's industry has since stagnated and gradually weakened.

But it has to be said that the strength of Japan's semiconductor industry chain should not be underestimated. With years of craftsmanship and accumulation, Japan has maintained a huge advantage in the field of upstream semiconductor materials and equipment. You must know that in the technology-intensive semiconductor industry, without qualified and advanced materials and equipment, IC design can only be on paper. IC manufacturing, packaging and testing are also nothing.

According to SEMI speculation, Japanese companies account for approximately 52% of the global semiconductor materials market. Shin-Etsu, SUMCO (Sumitomo Mitsubishi Co., Ltd.), Sumitomo Bakelite, Hitachi Chemical, Kyocera Chemical, etc. have an absolute advantage in the world. Key materials such as circles, photoresist, bonding wires, molded resins, and lead frames have a high share.

In the field of semiconductor equipment, Japanese companies are also extremely competitive. Although Japan is slightly inferior in terms of lithography machines, it has important front-end equipment such as electron beam drawing equipment, coating/developing equipment, cleaning equipment, oxidation furnaces, and vacuum CVD equipment, and important back-end packaging such as dicing machines. Japanese companies basically have a monopoly on equipment and important test equipment represented by probers.

However, under the game of big powers, Japan obviously has deeper ambitions. It not only injects large amounts of capital, but also tries to win TSMC with the intention of making achievements in weak packaging, testing and manufacturing. How feasibility is it?

The previous micro-report article quoted a Japanese analyst as saying that in the past ten years since 2012, Japan has not developed enough advanced logic chip industry ecology, and has not developed a vibrant Fabless and Foundry. One of the important reasons is that the domestic consumer electronics market in Japan has shrunk, especially the failure of smart phones has made Japan lose important application scenarios required for advanced logic chips. Restricted by various local market objective conditions and laws and regulations, Japanese semiconductors may only survive with IDM or light IDM. As for the cooperation to build a 20nm wafer fab, it seems a bit absurd and lacks feasibility.

According to Zeng Mengbin’s analysis, as for front-end engineering such as wafer manufacturing, we believe that investment costs (including land, manpower, water and electricity, etc.) are higher than the other two. At the same time, we have not heard that the Japanese government has a clear willingness to subsidize, so we still need Time to observe. In the future, Japan should mainly develop some IDMs, including Sony and Renesas. The chance of becoming a major semiconductor foundry country is not great.

At the packaging and testing level, which represents the focus of future wrestling, the world's top ten packaging and testing plants have long been deeply rooted in China, Singapore and other places. It must be said that Japan is already marginalized. According to Yole’s statistics, Japan’s global share of packaging and testing was only about 2% in 2018. Considering that the major OSAT manufacturers on both sides of the strait have continuously increased capital expenditures in the past two years, the growth rate is much higher than that of Japanese companies. It can be inferred that the figure for Japan in 2021 is only Can be less than 2%. Han Xiaomin also bluntly said that he doesn't think there are too many opportunities for development in Japan in the field of packaging, testing and manufacturing. The era has passed and the demand side is no longer in Japan.

Looking back at the development of Japanese chips, it started from scratch and was once brilliant, and then began to decline after the trade war. In fact, every stage was affected by the United States. It can also be seen from this that compromise and concession are definitely not the solution to trade frictions. Japan chose to make concessions and compromises, which ultimately led to the decline of the semiconductor industry. This also provides us with enlightenment. Only by not being humble, mastering the real core technology, and seizing the commanding heights of the industry, can we maintain our position in the fierce competition.

Because history has already stated that "success does not necessarily lead to life, and reverse does not necessarily lead to death."