Wafer Fabs Falling by the Wayside

Paul Lilly

We're getting mixed signals from the SEMI Industry Research and Statistics group. Just over a month ago, the firm reported that wafer fab capacity was back in the black with an 8 percent annual growth rate for both 2010 and 2011, and about 9 percent for 2012. Yet we're also being told that fabs are shutting down at a somewhat alarming rate.

SEMI says 15 fabs were shuttered in 2010, and 8 more will have the lights turned off in 2011, DigiTimes reports. The reason for this is that companies are looking to trim costs by becoming either fab-lite or entirely fabless, choosing instead to outsource their orders.

This all comes as good news to the Taiwan Semiconductor Manufacturing Company (TSMC), United Microelectronics Corporation (UMC), Globalfoundries, SMIC, and Samsung, all of which will pick up orders as other companies look to go fabless.

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