Samsung failed to win the foundry order... Global competition is brutal 💀

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Will Samsung Electronics be able to catch up with TSMC? The future is uncertain...

This time, Samsung Electronics is losing consecutively to the world's No. 1 foundry TSMC. Where? It was during the foundry war of orders.

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Samsung got hit by TSMC...

Following Samsung's failure to win orders for core chips for data centers ordered by NVIDIA, there are reports that consumer graphic card chips have also suffered from TSMC. In particular, it should be remembered that the previous model of GPU has been commissioned by Samsung. In other words, Samsung seems to have lost its job to TSMC.

There is an analysis that the background of the failure to win orders lies in the low yield. While TSMC's high-tech process yield is estimated to have reached around 70%, Samsung's process yield of less than 5-nano is known to be 30-40%. Samsung also installed Qualcomm's Snapdragon 8 on its smartphone Galaxy S22 because the yield of the Exynos 2200 made of 4-nano foundry was not high.

Galaxy S22 Ultra, Note is Back... But do you like it?

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What does Samsung think?

Samsung insiders seem to accept the failure to win the order as shocking. This is because the gap with TSMC has been clearly revealed, although a considerable amount of money has been poured in. Samsung Electronics Vice Chairman Lee Jae-yong released Semiconductor Vision 2030 in April 2019 and declared that he would invest $111 billion by 2030 to achieve the world's No. 1 foundry. 

Three years have passed, but the gap has hardly narrowed. According to TrendForce, a Taiwanese market research firm, the global foundry market share in the fourth quarter of last year was 52% for TSMC and 18% for Samsung. Samsung's market share has increased by only about 3 percentage points.

Lee Jae-yong being taken to prison T^T

<I will post why Vice Chairman Lee Jae-yong went to prison later!>

It is not easy for Samsung, which started its foundry business in 2017, to catch up with TSMC in a short period of time. Moreover, he was busy filling the management gap caused by the arrest of the president, let alone government support. Taiwan, where the government and businesses move together, is actively utilizing its strategic value, which has increased since the U.S.-China hegemony competition. The Taiwanese government has attracted U.S. tech companies, and TSMC has decided to spend $100 billion to increase its plants in the U.S. The U.S. government has decided to foster semiconductors as a strategic industry in terms of national security, and Intel made large-scale investments focusing on the foundry sector.

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What do Koreans think?

Koreans feel a great sense of crisis. This is because Samsung is the largest company in Korea and has a lot of employees. In fact, Korea is so dependent on Samsung that there is a term "Samsung Republic." Also, all Korean industrial standards and laws are following Samsung.

Watching Samsung's inability to do its best in the foundry, I deeply feel how cruel the world of business is that it does not allow or wait for the other person's situation. The global industrial trend of winner-take-all is becoming more solid. Samsung should regain its "Super-gap DNA (=Samsung's slogan)" through self-reflection and innovation. The Korean government should also benchmark the Taiwanese government and provide full support to the foundry industry to discover future food for the country.