Emerging Role of Full Service Semiconductor Silicon Brokers


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Buyers of Silicon Wafers at Semiconductor Devices manufacturers face new challenges as the industry consolidates, technologies change and wafer requirements become further stratified by device type. This will be strongly felt for Buyers supporting 200mm and below production with total silicon purchases of $20 million USD or less. A very good option is to work with a strong full service third party silicon broker. As basis for this there is discussion of change in some of the key industry traits from 1970 to 2000, 200 to 2010, and 2010 to now.

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Emerging Role of Full Service Semiconductor Silicon Brokers

  1. 1. Emergence of Full Service Semiconductor Silicon Brokers Full Service Semiconductor Silicon Brokers Emerging to Fill Supply Chain Needs. Astute Buyers especially at company's buying $20M per year of Silicon should consider establishing a relationship now with a Full Service Silicon Broker Bill Kohnen Silicon Buyers Roundtable
  2. 2. Full Service Semiconductor Silicon Brokers Benefits  Working with a Full Service third party silicon broker* is a viable option now even for mid sized device manufacturers purchasing up to $20 million per year of silicon.        Lower total cost by 10% to 15% Reduce Supply Risk Improve Logistics Ensure access to best technology Gain flexibility Improve Quality Benefits flow to both Producers and Buyers *While I don’t really like the term “broker” at this point I do not know of a better widely used description. Bill Kohnen Roundtable Silicon Buyers
  3. 3. As Segment Emerges  Brokers will smooth cycles by taking inventory for steady customers  Applications expertise will emerge at brokers  Management of related needs for reclaim and disposal  Silicon producers direct relationships will be only with hand full of users that may include joint venture factory  Good Brokers will add value and be able to chose both their sources and clients carefully and will not have to put themselves in losing business Bill Kohnen Silicon Buyers propositions. Roundtable
  4. 4. Key Trends in Silicon Industry Not meant to be complete and acknowledge exact details and timing subject to debate 1970 to 2002 2002 to 2009 2010 onward Silicon Producers Lots of Silicon Providers Consolidation of Traditional with Emergence of Suppliers in China and Taiwan Products Homogeneous product serves all customers Divergence of requirements with focus on end user Value add products with EPI, Attempts at differntiation with Float Zone/ requirements (Microprocessor, Memory, Mixed Signal, Denuded Wafer, SOI for high end applications but struggles for wide Analog, Power, MEMS) Impact of new process technologies acceptance. (FinFet, FD-SOI, EUV) Cutomer Interface Lots of sales people working for silicon providers. Direct Pulled back to suppoort by big regions; North America, Europe, Asia contact and Sales and Account support for each Fab site Almost no Regional Direct Sales. Customers Customers were device manufacturers that behaved in Emergence of Foundries as customers. Solar begins to emerge as a high similar fashion and segmented primarily based on size of volume user. demand and wager size Foundries and top 3 device producers drive volume.Many more types of customers that behave very differently based on segment. Solar does not have a direct impact on Semiconductor silicon market. Fabless companies dirve significant volume. Consumer companies like Apple take hands on apporach to devices Big presence at Semicon with over the top entertainment No direct Semicon presence and lucky to get an e-mail Christmas card Contraction Customer Buying Decisions Despite being a homgeneous product relationships between producer and end users important Price Starts to Dominate Decision Making for both Producers and Customers. Actual Commoditization of Silicon Agreements 12 month pricing with multi year supply agreements 3 to 6 month proce agreements with no long term supply agreements or Longer term agreements possible when customer views a frameworks producer as lowest total cost option Capacity Consolidation of capacity based on wafer size. Capacity for lower than On a macro level capacity is ok but within segments cutomers Producers tended to over build capacity in up portion of 300 mm primarily the result of de bottle necking and taking advantage of need to watch shifitng focus of producers. Esspecially as cycles meged equipment sets at a single location. Major customers form joint 450mm emerges and demand oscillates for high volume uses ventures. Poly Silicon availibility SCARE Broker/Non Producers Role Role of broker very limited to supporting research institutions and some spot test wafer requirements Bill Kohnen Capacity, supply and technical support within a segment import. Brokers emege as buyers of excess silicon to support solar demands. Emergence of value added third parties to assist both Silicon Reclaim Wafer companies start adding more value within their space and producers and consumers with supply chain Silicon Buyers Roundtable