TSMC is reportedly struggling to keep up with demand

Samsung Electronics on Thursday commented for the first time on Intel's decision to outsource more of its chipmaking, but declined to talk about any possible partnership with one its key rivals.

A job description on Intel's website gives us a rare glimpse at Intel's outsourcing plans. It's no secret that Intel will outsource more production to TSMC in the future, but so far, the company has been pretty vague about the details.

Samsung Electronics is increasing its effort in semiconductor outsourcing, separating the company's foundry business into a new unit as part of a challenge to market leader Taiwan Semiconductor Manufacturing Company.

Flextronics and Motorola Mobility have signed a definitive agreement, under which Flextronics will acquire Motorola's manufacturing operations in Tianjin, China, and will also assume the management and operation of its Jaguariuna, Brazil, facility.

Renesas Electronics said its alliance with Taiwan Semiconductor Manufacturing Company (TSMC) will help boost market share and operating margin.

Renesas Electronics and two other big Japanese chip makers have begun talks to combine their system chip operations and outsource production in a government-backed deal, sources said.

Nokia has completed a deal to outsource Symbian software development to Accenture, including the transfer of 2,800 workers to the global management-consulting firm.

Renesas is in talks to outsource production of auto microcontrollers to Globalfoundries Singapore, and some mobile phone semiconductor production to Taiwan Semiconductor Manufacturing Co. (TSMC), Shino Inokuma, a spokesman for Renesas, said by telephone.

Toshiba is hammering out a deal to outsource fabrication of advanced system chips to Globalfoundries, the Nikkei business daily reported, citing company sources.

As part of the strategy for transforming the system LSI business and securing an asset light business model, Toshiba has signed a MoU with Sony, expressing the intent to dissolve Nagasaki Semiconductor Manufacturing (NSM) and to transfer 300mm wafer fabrication lines there from Toshiba to Sony.

Toshiba will outsource fabrication of system chips to South Korea's Samsung Electronics, freeing up resources for its memory chip operations, the Nikkei business daily has reported.

"You used to have myriad semiconductor companies building fabs. Now they are expecting a couple of foundries to do it all for them," said Malcolm Penn, founder and principal analyst with Future Horizons.

"We're considering various options of outsourcing as well as strengthening our own production capacity because of rising demand," a spokesperson for Sony said. The Nikkei English News recently reported that Sony plans to hire Fujitsu for the bulk of the production process for complementary metal-oxide semiconductor sensors used in digital cameras and camera phones.

Renesas Electronics has announced it will cut about 5,000 jobs mostly in the current fiscal year and completed by March 2013. It also revealed plans to use outside foundries on all of its 28nm and smaller geometry semiconductor products.

Renesas Electronics is cutting nearly 10% of its 50,000 employees by the end of 2010 as it outsources production, according to a Nikkei report.

Vendors were hit hard by the downturn. 2010 looks better, but fab tool makers still face a number of challenges.

China exported US$957 billion of goods in the first 10 months of 2009, compared with US$917 billion for Germany, according to customs data compiled by Global Trade Information Services.

Chip design outsourcing growth fell to 6.5% in 2008, down from nearly 34% the year earlier, and the number of chip design starts are expected to fall another 18% this year...

Like many other chip makers, TI discovered that the cost of Moore's Law–industry shorthand for the race to shrink transistors on digital chips–is too costly for the payoff it brings. It began placing greater emphasis on manufacturing analog chips.

Toshiba is in talks with Singapore's Chartered Semiconductor and Globalfoundries about outsourcing production of some of its next-generation system chips to help cut costs, two company sources said.

Japan's Fujitsu said it would make its microchip unit profitable next year by cutting fixed costs and outsourcing production of next-generation logic chips to TSMC.

Back-end production capacity will be reduced at a plant in Mie Prefecture, Toshiba's main NAND flash memory production site, and shifted to a subsidiary in Thailand. Some procedures will also be outsourced to a foundry in Taiwan.

NEC Electronics will likely outsource more production of semiconductors used in consumer electronics to outside foundries to insure against a sudden plunge in demand following losses last year tied to a rapid drop in orders.

Standard Microsystems Corporation (SMSC) has announced plans to outsource some of its production test operations to Asian suppliers. The transfer of the production test operations is expected to improve the company's gross margin once completed at the end of its fiscal year.

Electronic manufacturers, including Toshiba and Hitachi, are planning to consolidate flat-panel television factories outside Japan and expand outsourcing to cut costs, the Nikkei business daily reported.

The economic slump has become so pronounced that even outsourcing is getting scaled back. Executives who once relied on outside firms to handle certain IT tasks to cut costs are now reining in some outsourcing plans on concern they're too expensive.