In oder to maintain a competitive edge against Samsung and Intel, TSMC is said to be deepening its cooperations with Ibiden Co. and Unimicron Technology Corp. in substrate production, an increasingly decisive sector for TSMC’s new advanced packaging business. Ibiden and Unimicron are the largest and second largest providers of substrates, with their respective global market share at 22% and 21%. TSMC’s cooperations with them are in part driven by its efforts to secure the supply chain, especially amidst the global chip shortage.
Already among the top 5 global players in the chip packaging industry, TSMC has integrated its advanced packaging technologies into the 3DFabric platform, combining the frontend System on Integrated Chips (SoIC) as well as the backend Chip-on-Wafer-on-Substrate (CoWoS) and the Integrated Fan-Out (InFO) technologies. It is believed that TSMC seeks to partner with Ibiden on CoWoS, while cooperating with Unimicron on InFO.
Based in Taiwan, Unimicron also cooperates with Intel, and saw its capital expenditure peaking in 2013 to build a dedicated Flip-Chip Ball Grid Array (FC-BGA) substrate production line for Intel. Given the specific advanced packaging technologies adopted by TSMC and Intel, substrate makers like Unimicron often build specially-catered production lines to win their contracts, according to an Unimicron adviser.
Similarly, in mid-2021, Intel also entered a deal with Samsung Electro-Mechanic to invest in FC-BGA substrate production capacity, aiming to secure its supplies, especially as Intel enters the foundry business. In the FC-BGA sector, Samsung Electro-Mechanic, Unimicron and Ibiden are among the few main players. Sources indicate that TSMC is also looking into FC-BGA for its applications in automotive electronics and servers, and its cooperation with Ibiden might cover the technology.
Ibiden, in fact, occupies a key role in TSMC’s global strategy, especially as TSMC expands its presence in Japan for both geopolitical and technological reasons. So far, TSMC has set up a 3DIC R&D center in Japan, partnering with approximately 20 Japanese industry leaders, among them Ibiden. Simultaneously, TSMC is also mulling to build a fab in Japan. A Japanese minister reportedly remarked that without Ibiden, it would be impossible to attract the TSMC R&D center.