[Agile Electronics Story] The Small and Delicate Electronics Industry's 'Big Brother' Semiconductor Part 1

Memory and Non-memory (System), Volatile and Non-volatile... Segmented by Structure, Function, and Usage
Global Memory Semiconductor Market Share by Sales in Q4 Last Year... Samsung Electronics and SK Hynix Hold 72.7%
Samsung and SK Challenge to Dominate System Semiconductor Market Twice the Size of Memory Semiconductor Market

[Asia Economy Reporter Ki-min Lee] ‘Agile Electronics Story’ is a column that keenly examines small pieces of information about electronic and mechanical products and devices. We will kindly cover hot new products frequently appearing in advertisements and news, nostalgic products, puzzling products and industry terms and news with the heart of a beginner.

As the novel coronavirus infection (COVID-19) crisis struck the world, the World Health Organization (WHO) declared a global pandemic on the 11th (local time).

Because of this, global stock markets are fluctuating wildly, and a storm is sweeping through the industry. The outlook for industries and products is generally unstable. Amid this, there are items expected to maintain a strong (strong) steady trend. That is the semiconductor, South Korea’s export cash cow and the big brother of the electronics industry.

This week’s ‘Agile Electronics Story’ briefly looks at the types of semiconductors and the current position of domestic companies, and next week we will examine the latest semiconductor technology trends and industry outlook.

Semiconductor, who are you?

A semiconductor refers to a material that has intermediate properties between a conductor, which conducts electricity well, and an insulator (non-conductor), which does not conduct electricity well. Semiconductor materials include silicon (Si), germanium (Ge), etc. Various semiconductor products that convert electricity into data or electronic signals are made through processes combining semiconductor materials with electronic components such as transistors, diodes, and circuits.

Although explained simply, making a single semiconductor product involves dozens of process steps. These are broadly divided into front-end and back-end processes. Front-end processes include circuit design, mask production where the designed circuit is divided by layers and drawn on a glass mask, silicon substrate (wafer) manufacturing, and wafer processing. Back-end processes include packaging, where chips made on the wafer are individually cut and assembled into frames, and testing, which is the final product operation inspection. The steps from wafer manufacturing to processing such as oxidation, photolithography, etching, thin film, metal wiring, EDS (Electrical Die Sorting), and packaging are sometimes called the eight major processes.

Not all semiconductors are the same... Memory and Non-Memory

Samsung Electronics' World's First 64 Megabit DRAM

Semiconductor products are divided into memory and non-memory. First, memory semiconductors serve the role of storing data. Memory semiconductors are classified into volatile memory (RAM, Random-Access Memory) and non-volatile memory (ROM, Read-Only Memory) depending on whether the data is lost after processing or stored.

Non-volatile memory includes static RAM (SRAM), which does not lose memory if power is not cut off, and dynamic RAM (DRAM), which loses previous data over time even if power is supplied. SRAM becomes structurally complex and more expensive per bit than DRAM as the number of memory units increases. The product representing the domestic semiconductor industry is ‘DRAM (Dynamic RAM).’ Due to its low cost and fast speed, it is used not only in servers and computers but also in mobile devices. DRAM is divided into computing memory that stores or transmits CPU data, mobile DRAM, graphic DRAM, and so on.

Non-volatile memory is also called flash memory. Devices using flash memory as storage media include removable storage devices (USB), SD cards, and SSDs. Flash memory is divided into NAND flash memory and NOR flash memory. NOR flash memory, which stores code, has a structure where data storage cells are arranged in parallel, allowing faster data retrieval than NAND flash and superior data safety. However, it has the disadvantage of slower write speed and difficulty in scaling to large capacity compared to NAND flash memory. For this reason, NAND flash leads the flash memory market.

Samsung Electronics image sensor 'ISOCELL Slim 3T2' (Photo by Samsung Electronics)

Non-memory semiconductors, also called system semiconductors, mainly perform functions such as computation and control. Their official name is logic chips. Representative non-memory semiconductor products include computer CPUs, mobile phone application processors (AP), and optical semiconductors used as image sensors.

Unlike memory semiconductors, where one company handles design through production, non-memory semiconductors have a structure where circuit design is done separately and production is entrusted to another company. Companies that only do circuit design are called fabless, and companies that manufacture under contract are called foundries.

System semiconductors are converged and applied in various fields such as IT, automotive, energy, medical, and environment. Especially, they are expected to continue growing as core components of artificial intelligence, Internet of Things, and autonomous vehicles.

Memory No.1 & Accelerating dominance in Non-Memory... Current position of domestic companies

Samsung Electronics Hwaseong Campus with memory semiconductor and non-memory semiconductor foundries.
[Image source=Yonhap News]

In fact, the market size of non-memory semiconductors is about twice that of memory semiconductors. According to the World Semiconductor Trade Statistics (WSTS), the 2018 non-memory market was $310.8 billion, while the memory market was $165.8 billion.

Domestic companies show high sales shares in the global memory semiconductor sector, especially in the DRAM and NAND flash markets. According to semiconductor market research firm DRAMeXchange, Samsung Electronics’ DRAM sales in Q4 last year were $6.761 billion, with a market share of 43.5% by sales. SK Hynix recorded $4.537 billion in the same quarter, accounting for 29.2%. Combined, Samsung Electronics and SK Hynix hold 72.7% of the market share. The NAND flash sector also shows solid levels. According to market research firm TrendForce, Samsung Electronics maintained the world’s No.1 position with NAND flash sales of $4.451 billion in Q4 last year, holding a 35.5% market share. SK Hynix recorded $1.274 billion in sales and a 9.6% share, ranking sixth in the same period.

Unlike the memory semiconductor market share, the overwhelming No.1 in the non-memory sector is Taiwan’s TSMC. According to TrendForce, TSMC held a 52.7% share of the foundry market in Q4 last year. Samsung Electronics’ share was 17.8%. In April last year, Samsung Electronics announced its semiconductor ‘Vision 2030,’ aiming to become the global No.1 in the system semiconductor market by 2030, investing 133 trillion won in R&D and facility investment. SK Hynix also plans to increase investments not only in memory but also in the foundry sector to secure market competitiveness. As part of this, SK Hynix plans to invest 120 trillion won by 2028 to build a semiconductor cluster in Yongin, Gyeonggi Province.

This content was produced with the assistance of AI translation services.