Analysis: The consolidation of the Japanese semiconductor industry is a difficult task

"Japan Economic News (Nikkei)" recently reported that three major electronics manufacturers in Japan, Renesas, Fujitsu, and Panasoinic, intend to merge each other's system-on-chip (SoC) design/development business to establish a new company; In addition, the report also pointed out that the three companies also intend to separate the wafer manufacturing sector and set up a full-time new organization.

It is understood that if the three major Japanese electronics factories really form a joint venture, they will receive large amounts of money from Japan’s official support “Japan Innovation Network”; rumors also point out that Globalfoundries also intends to join the joint venture. The Nikkei news report can only be said to be sketchy at the most, because no Japanese company has started to talk about this plan.

And such a complicated merger/joint venture plan is full of the bureaucratic atmosphere of the Ministry of Economy, Trade and Industry of Japan (MEITI); in fact, this type of industrial policy is of little use, and it may be able to make those three weak. The electronics manufacturers (mainly Fujitsu and Matsushita) have been living for a few more years due to government aid, but this move may threaten the most promising of them (Renesas) and they cannot stand in the already competitive SoC market.

Let us break this planned plan! First, Japanese semiconductor companies have experienced a series of consolidations, including Renesas's merger of Mitsubishi and NEC's wafer business in 2009. Even now, Renesas is still sorting through all the businesses that come from multiple acquisitions; in 2010, the company made a strategic decision to separate Renesas Mobile as a 100%-owned subsidiary. Focus on mobile applications SoC.

The goal of Renesas Action is to become "a choice other than Qualcomm" in the mobile phone market, and I suspect that Fujitsu Semiconductor's core ASIC business model and Panasonic's focus on large-scale integrated circuit (LSI) R&D Does the status quo help Renesas to achieve its goals? I think that help is not great.

At the same time, for Panasonic, the spectacle has long since surfaced for a long time; this Japanese consumer electronics maker may have had a glorious appearance ten years ago and has its own family of digital consumer electronic devices. Tailored Uniphier LSI chips. The idea was good at that time, and Panasonic was also very ambitious to sell its chips to other customers, but as Taiwanese chip designers such as MStar and MediaTek have risen in recent years, the plan has gradually lost its promise.

Panasonic announced the reduction of its semiconductor business last fall. It will lay off about 1,000 related manpower and outsource wafer production. It is estimated that Matsushita’s wafer production capacity will provide about 50% of the internal use of the group, but the company will stop producing TVs. After the machine may be further reduced. For Matsushita, which is trying to reform its semiconductor business, if it can be merged with Renesas and Fujitsu, it will undoubtedly be a gift from the sky. The company suddenly has a place where it can pass on fabs and related personnel.

As for the plight of Fujitsu Semiconductor, it is the lack of a platform; Fujitsu is still mainly an ASIC supplier. The company may have outstanding performance in building outstanding ASICs for domestic system customers, but it has not been able to transform itself into an ASSP supplier. The advantage that Fujitsu Semiconductor can provide for a hypothetical three-way joint venture is as unclear as it may be for more Japanese customers such as NTTDocomo, but it is certain that there will not be too many overseas customers.

The more bizarre proposal is to merge the wafer manufacturing operations of the above three Japanese manufacturers - how to make the fabs abandoned by those three companies become viable wafer manufacturing joint ventures? In addition, exactly what role does Globalfoundries play in it?

On the whole, this strategy to create two joint ventures, one responsible for wafer design and one full-time wafer manufacturing, may only allow the three electronics companies to easily discard unwanted things, and it will not be crowned as a layoff villain by Japanese society. "The stigma (in Japan, layoffs and closing factories will be a particularly big event).

But the lack of leaders and the introverted (always inevitably delaying the year after year) nationality has caused the Japanese electronics industry to lose a lot; this industry, which was once the most active on the island of Japan, is now as ignorant as a fly. Where to go, it's very sad for the future. There is a saying in Japan that “as long as there is unity, there is no fear”; but now it seems that this group of people is afraid and no one wants to take the first step.