The carmaking industry has been plagued by components shortages for months, but TSMC says its supply of automotive chips to clients should start to improve in second-quarter 2021. But the automotive chip shortage is a structural problem where cars need more electronic components, intensifying competition between carmakers and IT firms for foundry support. And at Samsung, tight in-house foundry capacity as a result of a previous power outage hitting one of its fabs in the US is sending the Korean giant looking to outsource some of its chip production. TSMC expects auto chip shortage to greatly improve starting 2Q21: The ongoing shortage of automotive chips will be greatly reduced starting the second quarter of 2021, according to pure-play foundry TSMC.Car vendors dealing with structural shortage of chips: Car vendors are dealing with a structural shortage of automotive chips resulting in their supply constraints, according to industry sources, who believe the impact of a recent power outage at TSMC's chip plant will be insignificant on the overall auto chip supply.Samsung reportedly looking to outsource memory controller production: Samsung Electronics is looking to outsource the production of its memory controllers amid tight capacity at its own foundry, according to market sources.

Wired Magazine once indicated in a report that as the ultimate human-machine interface for various technological devices, AR technology in the 5G and 6G era will be used for integrating a comprehensive range of information and presenting it to the user in real time. With the COVID-19 pandemic ravaging the world, remote communication has become an important operating mechanism of society, highlighting the crucial role AR/VR plays in such systems. From this perspective, two resident teams at Taiwan Tech Arena (TTA), HorusEye Tech and Toii, led a discussion, "Crossing X Realms: Utilizing AR's new 'Realm of Vision' to enhance your immediate combat power," at a recent forum organized by Digitimes.Bill Tseng, co-founder of HorusEye Tech, pointed out at the DForum that AR technology has become increasingly prevalent in the film and television entertainment industry, and that over the past few years the technology has appeared in movies such as Marvel's Iron Man and music videos by Jolin Tsai. As the application of this technology became more widespread, nonetheless, issues with interfacing have also begun to emerge. According to Tseng, image composition is in 3D whether it is AR, VR or MR, but the current interfaces for presenting this type of technology are all 2D screens, and therefore the quality of the 3D images presented is extremely limited. As such, he believes that mobile phones and other flat screens will only be a transitional interface for AR/VR/MR, and that near-eye display will ultimately prevail.Among the quite diverse applications of near-eye display, currently the most demanding is medicine. Applications in this field are estimated to reach US$175.5 billion in 2026. Taking surgical navigation for example, Tseng stated that to ensure surgical procedures are more precise, surgical or drilling paths are simulated before the operation, and the surgeon performs the operation while comparing the simulated route on the screen. The current practice is to place the screen on the side of the operating table, and the surgeon must turn his or her head to look at the screen, but this unintuitive approach may affect the accuracy of the operation. The best way is to use near-eye display and AR technology to display the surgical information directly in the doctor's line of sight.In the past, however, near-eye display still had three major issues - dizziness, loss of contrast and focal rivalry - that needed to be resolved. If these problems can be resolved successfully, application of the technology will widen significantly and market output value will also grow rapidly. HorusEye, a company composed of experts from diverse professional fields such as optics, software, hardware, IP and ID, has been able to eliminate the above-mentioned pain points in near-eye display optics, and is able to offer users a more comfortable and easy-to-use AR/MR experience.In addition to niche markets, AR/VR can also be integrated into all aspects of life for creating various applications. Allen Yu, founder of Toii Virtual Gaming Lab, said that the company focuses technologically on AR+LBS (indoor positioning), an application that is currently mainly used in smart cities but has also been applied in tourism.Yu indicated that AR technology has been on the market for quite some time with the most well-known application being the mobile game of Pokemon Go. The game, launched by in 2016, took the world by storm as soon as it came out, allowing consumers and industry peers to see the feasibility of this technology. Apart from games, AR can also be applied to other fields. In the retail industry, for instance, stores can use AR to provide various services. Consumers can see the location or information of the goods they want to buy on their mobile phones, and AR can also be combined with AI so that, when consumers have questions, the virtual customer service on the system appears instantly and answers the questions.Another application is to integrate AR with tourism and create new business opportunities with new models as has already been done in both Taiwan and Japan. Two previous successful cases in Taiwan are the limited-edition Pokemon Go events in Chiayi and Tainan, where limited-edition Pokemon characters were released for players to catch while local merchants tok part in the design of various promotional activities for expanding business opportunities. In Japan, on the other hand, Guided Anime Spots Tours combining AR with well-known animation attractions are available. When fans take pictures at destinations such as Totoro Forest, the Slam Dunk seaside railway crossing and other places, anime characters will appear on the screen. In addition to the animation industry, local governments of rural regions have also cooperated with gaming companies in the design of various AR games to attract visitors and tourists.As technical challenges continue to be overcome, the implementation of AR/VR will begin to accelerate. Tseng and Yu both think that with Taiwan's strength in science and technology, a large number of talented professionals from various countries seeking shelter from the COVID-19 pandemic will be bringing large amounts of resources in the forms of funds and technologies to Taiwan where epidemic prevention has been largely successful. Under these premises, the two urged Taiwanese businesses to take advantage of this opportunity by utilizing their own technological advantages to unveil creative applications of extended reality (XR) for manufacturing, medical and audio-visual sectors. This will enable businesses to create unprecedented experiences and business opportunities while simultaneously accelerating the upgrading of other industries in Taiwan, resulting in a scenario of mutual benefit for all parties concerned.Bill Tseng (left), co-founder of HorusEye Tech, and Allen Yu (right), founder of Toii Virtual Gaming LabPhoto: Sandy Du, Digitimes, April 2021

With the convergence of 5G, AI, IoT and hyperscale computing, what will computing needs look like in the next decade? As the heart of the computing and connectivity revolution, and the developer of widely used processor architecture, Arm has outlined its vision over the next decade through the recent launch of the Armv9 architecture.CK Tseng (left), President of Arm Taiwan, and Dr. JC Hsu, Corporate VP and GM of MediaTek's Wireless Communications Business Unit (right)As AI-powered compute becomes ubiquitous, CK Tseng, President of Arm Taiwan, expected that another 300 billion Arm-based chips to ship during the next decade and could be widely used in end devices, data networks, edge computing or in the cloud. After a holistic consideration of the balance between general purpose and specialized processing as well as factors such as safety, performance, ease of development and power efficiency, Armv9 is the solution developed to address this unprecedented opportunity for innovation. How to leverage Arm architecture and its strong ecosystem to make innovations is what the whole industry can think about to identify and size up the business opportunities.Computing needs and challenges for the next decadeIt has been 10 years since Arm launched Armv8 architecture. More than 180 billion Arm-based chips have been shipped over the past 30 years, Tseng said. From sensors, edge, networks to the cloud, the vast majority of shared data today are processed by Arm processors at some stage through its lifecycle. Therefore, when we started developing the Armv9 a few years ago, we have been thinking about what's the biggest challenge over the next decade? How can we help developers prepare for the future?Shipments of Arm-based chips are expected to reach 300 billion in the next decade for diverse innovative solutionsFirst, information security is the biggest challenge. "Data has become an important asset for individuals, whether in consumer, industrial or commercial applications, ensuring privacy and security is an urgent issue." In addition, with the growing innovative applications and the cost to launch an app is getting lower, there will be more and more people engaged in software development. In the future, the number of software will increase greatly, how to prevent important information from being stolen and make the development of applications easier and seamless is a matter to be considered.In the meantime, the popularity of AI and hyperscale computing applications will continue to drive the development of edge AI, and the market has endless demand for lower power consumption and higher performance. Arm is developing technologies to increase efficiency, bandwidth, cache size and reduce memory latency to maximize the performance of Armv9-based CPU to collaborate with partners to react to challenges.Another challenge posed by the ubiquity of AI in computing is that the requirements for specialized processing solutions will become higher. Different market segmentation, performance and use cases will bring different computing requirements. How to flexibly utilize the hardware and software capabilities of CPU, GPU and NPU processors to optimize the AI workload in the optimal solution is also a problem to be solved.The future of specialized computing delivers enhanced security, AI and system performanceTherefore, in addition to enhancing security and core performance, Arm is also trying to create solutions that meets the needs of specialized computing under the general-purpose and flexible hardware architecture to achieve the optimal "system-level" performance.Tseng said that in anticipation of this trend, Arm has changed to define the organizational structure from an application point of view rather to define from product lines to cater for the specific needs of computing technologies for different applications.David Hsu, Arm FAE Director, added that specified processing is needed to respond to the diverse needs for future chips. That's why Arm integrates Arm CPU, GPU and NPU platforms to deliver greater efficiency, scalability and flexibility. In addition to hardware, Arm has also put a lot of efforts in building a software ecosystem. "The future is an era of contextual optimization, moving beyond individual IP specification, where software will play a much bigger role."To this end, Arm introduces SystemReday program. As long as hardware and underlying software comply with defined system standards, all operating systems can run on top of them and can be compatible with Arm-based hardware, from sensors, edge to the cloud. Based on the concept of a software-defined device, the adoption of the Arm architecture, which is widely used in the industry, will ensure that developers can maximize their software investment, Tsang said. "Since we can't anticipate the performance of the end devices, in order to achieve the best performance, self-developed software and cloud software will co-exist in the future. There'll be more and more cloud-native software running on the edge devices, and we encourage partners to join."The Arm SystemReady program achieves balance between standardization and flexibility, helping partners innovate with differentiated designsHsu emphasized that for Arm, these efforts are all about trying to strike a balance between standardization and flexibility. Through standardization of hardware and underlying software, such as defining the standards in the Base System Architecture (BSA) and Base Boot Requirement (BBR), it will be easier for companies to port software and allow them to focus on application innovation and design differentiation.On the security front, Armv9 introduced the Confidential Compute Architecture (CCA), introducing the concept of dynamically created Realms for the first time to protect data in use. The main difference between Realms and the existing TrustZone technology is that the latter believes the underlying operating system is secure while isolating secure world from non-secure world. On the other hand, the protection in CCA is to transfer data to its own Realms through an additional address translation, making it hard for the operating systems to probe the code and data executed in the Realms. Therefore, even if an operating system is compromised, the data and codes in Realms can still be ensured.The Arm Confidential Compute Architecture (CCA) introduces a new concept of dynamically created RealmsRealms are an evolution of TrustZone. By being isolated from the operating system, Realms provide an additional layer of protection for software. Even dynamically downloaded apps on mobile phones can gain higher confidentiality by introducing the Realms. In addition, the Armv9 architecture provides enhanced support for Memory Tagging Extensions, which protects data passed from the CPU to the memory by allowing software to associate a pointer to memory with a tag to counter attacks on memory security vulnerabilities. Security is enhanced through the various protection mechanisms in hardware and software.In digital signal processing (DSP) and AI computing, Arm partnered with Fujitsu to create the Scalable Vector Extension (SVE) technology, which is at the heart of the Fugaku, the world's fastest supercomputer. Building on that work, SVE2, an enhanced version of SVE developed for Armv9, enables support of vector length from 128 bits to a variable of 2048 bits.Hsu said that such a large amount of parallel computing power enables Armv9 to work well for 5G systems, virtual reality, augmented reality and also for machine learning workloads. Over the next few years, Arm will further extend the performance with substantial enhancements in performing Matrix Multiplication within the CPU. In addition to expanding AI capabilities, AI innovations in Mali GPUs and Ethos NPUs will continue.Leverage Arm ecosystem to accelerate product innovation and differentiationThe release of the Armv9 architecture is just a start. The industry will continue to see Arm roll out new products and technologies to propel Arm's vision: specialized processing, built on the economics, design freedom and accessibility advantages of our ubiquitous computing platform, enabling our partners to deliver best in class solutions across all markets. The first Armv9-based product will be available this year.Armv9's advanced architecture opens up more innovation possibilities and new opportunities for Taiwan's technology industry. Tseng said Taiwan's technology sector had performed well in 2020, but the challenge of moving beyond existing business models to increase business value in response to the needs of the new generation of computing remains to be solved. "Taiwan companies have been very well versed in technology. Facing various opportunities such as 5G, IoT, cloud, automotive and others, they need to develop long-term profitability models and increase investment in innovation to lay the foundation for future growth.""In Arm's case, we started investing in Armv9 research and development a few years ago to keep pace with the trends and partner needs. The opportunity Armv9 brings to Taiwan is about providing more value and the possibility of differentiation, which is the key to success," Tseng said.Hsu explained, "In the case of smart camera, Taiwan companies has built strong capabilities from chip design, software to the machine. The competitive advantage can be further improved by taking advantage of Armv9's enhanced security and AI performance to take the lead in developing more powerful and more secure products, for example, achieving higher recognition accuracy in AI, in line with the special use case, or increasing product security.""Arm has been deeply cultivated in Taiwan for more than 20 years, and we have been committed to helping our customers expand the market and drive business value." Tsang said. "Taiwan has built up strong design capabilities and already been a critical part of global high-tech supply chain, and we look forward to helping partners speed up time to market for new products through Armv9's excellent features and enhanced connection of ecosystem.""We see great opportunities in areas including smart cameras, smart surveillance, PC, laptop, edge computing, data centers, automotive, and industrial computers for Taiwan companies." Tseng explained.MediaTek took the lead in adopting Armv9 and the new product will be available at the end of this yearMediaTek has become quite the household name in 5G mobile communication technology over recent years. Apart from just smartphones, Arm's collaboration with MediaTek on new Armv9 architecture products extends throughout its product range. "The Arm Neoverse solution supports more cores at constant thermal design power (TDP), improves energy efficiency and performance to offer greater potential for workloads such as high performance computing and machine learning. We are in ongoing discussion with MediaTek in consumer electronics and communication areas such as 5G wireless base stations, enterprise private networks, edge computing, core networks and data centers, etc., and look forward to more cooperation opportunities," said Tseng.At the global launch of the Armv9, MediaTek announced that their first Armv9-based smartphone product will be available by the end of 2021. "MediaTek has built up an abundance of product lines encompassing mobile devices, home entertainment applications, wireless connection technologies and IoT markets over the years. The scalability of the Arm architecture, along with excellent performance and design innovation are key as we expand the MediaTek portfolio," said Dr. JC Hsu, Corporate Vice President and General Manager of MediaTek's Wireless Communications Business Unit.JC Hsu believes that the support and advice provided by the Arm team has indeed played a key role in enabling MediaTek's continued innovation and product enhancement. He thinks very highly of the Armv9 architecture in terms of its better security, computing performance and energy efficiency. Through Arm's multiple solutions, including high-efficiency, low-power design and the scalability of the system platform, MediaTek will continue to work closely with Arm in all fields going forward.This echoes what Tseng has stressed all along -- the hope of helping Arm partners to leverage Arm core architecture, the powerful ecosystem and software support to expand markets and generate business opportunities. It is expected that Armv9 will become the foundation for next-generation chip designs as well as the opportunity for enterprises to enhance their competitiveness and technological innovation.Click here to get more details on the Armv9 architecture

TSMC expects flat sequential growth in its second-quarter 2021 sales, but has upward revised its outlook for full-year 2021 revenue to around 20% growth. The foundry house has also raised its capex budget for 2021 to US$30 billion. In the display sector, AUO is expanding its 6G LCD line in Kunshan, China to cater to strong demand for LTPS panels for notebooks. Notebook PCB makers in Taiwan also expect strong sales in first-quarter 2021.TSMC expects flat 2Q21, raises capex outlook: TSMC expects to post revenues of between US$12.9 billion and US$13.2 billion in the second quarter of 2021, which is a 1% sequential increase at the midpoint. Gross margin and operating margin for the second quarter are estimated at 49.5-51.5% and 38.5-40.5%, respectively.AUO expanding 6G LCD line in China: AUO is expanding capacity at its Kunshan, China plant, with new capacity scheduled to arrive in the third quarter of 2022.Notebook PCB makers to enjoy strong 1H21: Taiwan-based notebook PCB specialists including HannStar Board and Taiwan PCB Techvest (TPT) have posted brisk sales results for the first quarter, and are poised to enjoy a particularly strong first-half 2021, according to industry sources.

ICs accounted for a record-high 35.5% of Taiwan's total exports in 2020, indicating Taiwan-based chipmakers are increasingly critical to the country's economy, according to Digitimes Research.Taiwan is where industry leaders such as TSMC and MediaTek are headquartered. Its ICs are playing an increasingly important role in Taiwan's total exports, compared with about 20% that semiconductors contribute to South Korea's total exports, Digitimes Research have found.ICs accounted for only 18.1% of Taiwan's total exports in 2011, duing which TSMC just moved 28nm process to mass production while MediaTek was not yet a global top-20 chip supplier.Taiwan-based IC suppliers have greatly enhanced their global competitiveness, but it remains to be seen whether their global presence can be maintained or even grown.South Korea's semiconductor exports came much above Taiwan's during 2017 and 2018, when the global top-2 memory chipmakers - Samsung Electronics and SK Hynix - enjoyed the most gains from the memory market boom. Nevertheless, with the memory market sliding from its peak, Taiwan's IC outputs surpassed South Korea's in 2019 and 2020.Taiwan's IC exports came to US$100.3 billion and US$122.5 billion, respectively, in 2019 and 2020, while South Korea's total semiconductor exports reached US$95.2 billion and US$100.3 billion. Taiwan-based IC design houses and foundries' sales growth contributed to the country's overall IC output value over the past two years.Taiwan's IC exports surged 28.3% on year to US$33.81 billion in the first quarter of 2021, while South Korea's semiconductor exports grew 14.6% from a year earlier to US$26.59 billion. Taiwan's IC design and foundry sectors remained critical to the country's total IC exports, according to Digitimes Research.Semiconductor exports from Taiwan and South Korea, 2017-2020 (US$b)Source: Compiled by Digitimes Research, Apil 2021

Apple is expected to soon unveil a miniLED-backlit iPad Pro, and its miniLED supply chain is ready to expand shipments, having improved yield rates. In the semiconductor sector, supply for packaging tools has been extremely tight, with equipment vendors reluctant to expand production, wary of possibly a lurking bubble in the market. And MediaTek is keen to maintain its leadership in the 5G phone market segment. The IC vendor has stepped up purchases of BT substrates for use in its 5G mobile SoCs to make sure it has enough supply.Apple supplier to increase miniLED shipments for iPad Pro in April: Apple's supplier of backlight-use miniLED for the vendor's upcoming 12.9-inch iPad Pro will see shipments pick up later in April 2021, according to industry sources.IC packaging equipment in severely tight supply: The supply of IC packaging production tools including polish grinders, wafer-dicing machines, and tape laminators has become severely tight, apart from delivery lead times lengthened for wire-bonding machines, according to industry sources.MediaTek steps up BT substrate purchases: MediaTek has stepped up its purchases of BT substrates for use in its 5G mobile SoCs from suppliers including Unimicron Technology and Kinsus Interconnect Technology, as part of its efforts to expand presence in the 5G handset AP market, according to industry sources.

Wistron has partnered with AppWorks to activate an accelerator program, aiming to recruit startups particularly from the AI, cloud computing and cyber security industries.Wistron has been cooperating with AppWorks since 2014 and is a major shareholder of AppWorks Fund II and III. Wistron also invested in several startups incubated by AppWorks including cyber security solution developer Umbo Computer Vision, machine learning platform developer MoBagel and pet healthcare AI designer Aniware.Wistron's accelerator program is open to applicants twice a year with accepted startups also eligible for AppWorks' accelerator and cooperation with Wistron's affiliates.So far, Wistron has invested a total of over NT$10 billion (US$348.25 million) in 50-60 companies that cover emerging applications such as those for education, enterprise services, IoT and medical care.

5G is no doubt a hot key word in today's high-tech world. The disruptive changes 5G will bring are nothing like those in the times of 3G or 4G. Never-before-seen features such as network slicing, virtualization, and ultra-low latency are expected to give rise to a myriad of smart innovations which will generate enormous business value. As such, the main 5G market will target enterprise applications, unlike the 3G/4G market which focuses on consumer applications.It is foreseeable that massive amounts of data will be generated as 5G services become available, which will be instrumental to the realization of AIoT applications. Data flow across each node, including the end devices, base stations, and core networks, will be much bigger than before and instant processing will be needed. In response, fronthaul or backhaul transmission speeds have jumped from 10Gbps to 25~50Gbps while core network transmission speeds have surged to 100Gbps, 400Gbps, and even 800Gbps. This has spurred escalating market demand for high-speed copper conductors and optical interconnects. JPC, long devoted to high-speed cabling and optical communication modules, stands to reap the benefits.There is one more thing that is quite different between 5G and previous generations of mobile communication technologies. That is, telecom operators are more concerned about their return on 5G investment than before. This leads to the rise of Open RAN (O-RAN), OCP, ONF and other international organizations promoting open-source 5G network architecture. Originally close-ended base station technologies, resources, and devices are now being delayered and deconstructed while software and hardware are being disintegrated as well. The open trend will have a major influence on JPC.According to JPC chairperson Shu-Mei Chang, the term "open" was hardly heard of during the times of 4G or even earlier 3G and 2G. In other words, the telecom world kept to itself. Telecom and datacom were two different worlds and their paths did not cross each other. Now with 5G O-RAN, new types of telecom operators like Japan-based Rakuten and German-based 1��1 Drillisch are emerging. Telecom heavyweights like AT&T are actively embracing open architectures as they will be able to freely purchase white-box servers, switches, storages and small-scale base stations to rebuild their mobile communication systems. Leveraging wireless network virtualization, they can change the traditional telecom network architecture, thereby breaking free from vendor lock-in and achieve performance and cost optimization.The market embraces JPC's high-speed transmission products with increasing O-RAN and OCP adoption"As O-RAN architectures and Open Compute Project (OCP) platforms get increasingly adopted, white-box equipment suppliers that had difficulty penetrating into the supply chain of the telecom industry with a history of over a hundred years now stand a chance of tapping into the new blue ocean market of 5G telecom networks," said Chang. To do so, white-box equipment suppliers need to find active optical cables (AOC) and direct attach copper cables (DAC) used to connect servers and switches, some of which need to deliver data rates as high as 400Gbps. A large quantity of fiber optic or copper cables is also required for the deployment of telecom central office infrastructure.This presents new opportunities to JPC. The customer base of JPC had primarily included switch or server manufacturers and cloud service providers with very few white-box equipment suppliers until two years ago when JPC started to reach out to white-box equipment suppliers and system integrators (SI) in view of rising O-RAN and OCP popularity spurred by 5G and stepped up efforts to pitch JPC's high-speed transmission products to them. After a break-in period, JPC has strengthened the engagement with data center operators, equipment suppliers (including servers, switches and storage devices) and electronics manufacturing service (EMS) providers and has begun making shipments to these new customers.What's more, growing 5G developments have also prompted distributors, value-added resellers (VAR), supercomputer suppliers, hospitals, schools and information security device vendors to actively approach JPC for partnership deals to incorporate 100G/400G high-speed transmission products to enhance their application/service performance. What this means is that enterprises or organizations that had nothing to do with JPC in the past now join its expanding customer base, allowing JPC to tap into tremendous opportunities.Of course, these burgeoning opportunities do not come out of nowhere but result from JPC's technological strength built through two decades of efforts. Dr. Chi-Hsien Sun, in charge of JPC's product R&D for the cloud network communication component industry, noted that JPC has stay committed to enhancing its electronics development capability since 2000, transcending from traditional molding, stamping and injection processes. This allowed JPC to lead the industry in replacing conventional connectors with PCBA terminals and thereby build up a strong foundation of PCB layout and impedance matching technologies. JPC has also stayed ahead in the transition to active copper cables (ACC), based on which it was able to increase the transmission range and reliability of copper cables.Soon afterwards, JPC undertook the development of optical modules featuring optical packaging and laser/optical coupler technologies. Not only has JPC effectively raised the transmission speed of its optical modules, but it has also reduced the power consumption and enhanced the heat dissipation. JPC has received four patents for its optical module technologies. Its leading-edge technologies will enable JPC to capture preemptive opportunities in the low speed to high speed transition and electrical signal to optical signal conversion brought by 5G and become a strong force supporting white-box equipment suppliers' foray into the telecom market.JPC chairperson Shu-Mei Chang

TSMC chairman Mark Liu took part in a White House-hosted online meeting of the world's semiconductor powerhouses on Tuesday. After the meeting, Liu reiterated the Taiwan-based foundry house's commitment to building a wafer fab in the US state of Arizona. The semiconductor supply chain has been troubled by shortages for months, with major Taiwanese IC vendors set for another wave of price hikes in second-quarter 2021. Development of microLED applications have been gaining momentum, and commercialized products may be available as early as year-end 2021.TSMC reiterates commitment to US fab project: TSMC chairman Mark Liu, who participated in a virtual summit hosted by the Biden administration to discuss global chip shortages and the US plan to rebuild its semiconductor manufacturing edge, has reiterated the Taiwan-based foundry house's commitment to building an advanced wafer fab in the US.Major Taiwan IC design houses to hike prices in 2Q21: MediaTek and Elan Microelectronics both plan to raise their chip prices by 10-20% to reflect rising foundry costs starting May 1, while fellow IC design company Realtek Semiconductor will also hike its chip prices by over 20% later in the second quarter, according to industry sources.MicroLED may start taking off at year-end 2021, says PlayNitride executive: Development of microLED applications has been gaining momentum, with commercialization of the technology likely to begin at year-end-2021 at the earliest, according to Falcon Liu, marketing director for Taiwan-based PlayNitride.

Shortages, which were originally attributed to the COVID-19 pandemic, have continued to worsen in 2021. Continuous demand growth in various sectors like 5G, automotive and IoT, ongoing raw material shortages and catastrophes are the primary culprits.2021 Q1 in reviewThe year opened with renewed concerns over legacy case size MLCCs used in the industrial sector, 5G smartphones and the automotive sector due to a fire outbreak at the Walsin production plant in China. And, it's getting worse as supply of high-capacitance MLCCs, in particular, has been exacerbated since January, largely caused by a sharp rise in 5G mobile phones after the Chinese New Year.In February, a winter storm in Texas caused widespread power shortages and blackouts. Because Texas is a US hub for chip manufacturing and electronic production, major chip manufacturers were impacted including Samsung, NXP and Infineon.In the same month, an earthquake resulted in a blackout at Renesas's Naka factory, and production was temporarily suspended. The impact on supply chains from this event was limited. However, in mid-March, the same plant caught fire, and damaged 23 machines, including plating machines used for wiring. The components most affected include a variety of automotive and non-automotive MCUs as well as power management and MOSFETs.Unexpected events, such as the Nittobo and Renesas factory fires, have also worsened the supply of already short raw materials like silicone and glass substrate, wafers and crystal oscillators. Production for a variety of components has been impacted as a result, causing shortages of ICs, CPUs and memory. Memory module pricing, for example, increased 5-10% above official pricing.The shortages have hindered the automotive industry especially. The lack of MLCCs and automotive chips forced automakers like Volkswagen, Ford and Toyota to cut production early in the year despite growing consumer demand. As a result, the US, German and Taiwanese governments were pressured to convince IC leaders like TSMC and UMC to reallocate production to support struggling automotive manufacturers. Unfortunately, the Renesas plant fire will only increase the obstacles the automotive industry continues to encounter.The rollout of 5G technology has also been hindered by the IC and CPU shortages. Chipmakers are currently struggling to meet demand for processor chips used in smartphones, which has affected production lines of Samsung and Apple. The shortage of ICs has also led to supply constraints for SSDs, which have been in high demand from the rollout of 5G, IoT and new gaming activity.A look into Q2In Q2 we are sure to fully realize the impacts of these unpredictable disruptions while facing additional shortages on the horizon.Raw materials worsenAs seen throughout 2020 and in 2021, raw material shortages have intensified, and it doesn't appear to be ending any time soon.The ABF substrate shortage has been the biggest contributor to the CPU, GPU and IC shortages, and is currently predicted to last until 2023. Because ABF manufacturing equipment has a lead time of 12 months, ABF makers are focusing on increasing yield rather than capacity. With no supply relief in sight, prices will continue to rise over the next 6 months, leaving customers to pay the price.Semiconductor production continues to be disrupted by the 8-inch wafer shortage with dim prospects for recovery as the substrate shortage continues. The 8-inch wafer is needed for CMOS sensors, power supply controller, MCU, RF component, MEMS, etc., which is why numerous industries are competing for this resource. As TSMC moves to focus its production on automotive chips, the production of other industries will suffer as a result.Certain crystal oscillators, including TCXOs are seeing supply issues fostered by the Asahi Kasei Microdevices (AKM) fire that occurred in October 2020. Despite AKM starting to ship out stock through its subcontractors, there is extremely limited supply and customers are being urged to find products from other manufacturers until alternative production is available. AKM's production lines will not be fully operational until March 2022.Other raw material shortages are starting to appear, such as with glass and precious metals. Palladium, used in electronics and a key component in vehicle pollution-control devices, is experiencing rising prices as usage grows. Price increases currently paid by automakers may be passed off to customers if output falls short of demand as predicted.Growing component shortagesThere is growing demand for ICs related to five key areas: energy efficiency, mobility, security, IoT (internet of things) and server/cloud services, which is putting pressure on supply. As such, overall IC shortages are expected to continue to be widespread across all brands throughout Q2.Rising automotive demand has worsened the chip shortage, causing a chain reaction across different industries. Because some chip makers are shifting production to focus on automotive products, supply for industrial products will likely take a hit and pricing will continue in the quarter.Pricing for automotive ICs, generally, is rising by about 30% while current lead times are around 28 weeks - and could grow up to 40 weeks. Lead times for industrial application MCUs are currently facing extending lead times due to automotive demand as the industry continues to see many shortages.Demand from the automotive market, in addition to high demand for PCs and smartphones, has put a strain on MLCCs, which has resulted in price increases. Analysts have predicted that the MLCC shortage is expected to worsen through Q3, and prices are believed to increase in Q2. With limited foundry capacity and many manufacturers competing for these necessary products, the automotive industry won't see supply relief until the second half of the year.The mobile phone market is also being affected by IC shortages, as well as heightened memory pricing from little supply and growing demand. Mobile phone memory products are seeing price increases and a supply gap from customers pulling in extra stock as a buffer against these prices.If demand for memory strengthens as predicted, contract prices for memory will rise further in Q2 and gaps in supply will worsen. Samsung has already announced a pricing increase of 10% in April, and Intel and Micron prices are to rise by 5% as well.Furthermore, implementation of 5G coupled with rising consumer demand for smarter technology in mobile phones, automobiles, wireless applications, and appliances will cause enterprise and cloud storage companies to have increasing need for larger and faster SSDs, which requires more NAND flash. Since NAND flash demand will likely outpace supply in Q3 as new mobile devices and CPUs hit the market, SSD pricing will rise anywhere between 5-15% as a result and continue through the year.Ramification of natural disastersThe Texas storm is sure to cause supply issues for memory, automotive MCUs, storage and more for weeks to come. Plant interruptions from the rolling blackouts in February have decreased overall production at a time when chip demand is already higher than capacity can met.NXP is one company that reports it experienced a month's loss of chip production due to the event and lead times for its products will extend by 8-12 weeks as a result. Infineon's production of MCUs and NOR flash memory chips have also been heavily affected, especially since its NOR flash supply had been facing shortages. Because of this, memory pricing is predicted to rise as much as another 10% in Q2.Comparatively, Renesas's fire has had a much worse effect on its production of MCUs and MOSFETs, which will require at least 100-120 days to recover according to the company. It will take 6 months for the company to recoup its losses, and automakers, especially, will feel its effects in April.The continued drought in Taiwan will only exacerbate the effects of these shortages, especially since Taiwanese plants and foundries produce approximately 53% of global semiconductors. Because water is key in processing silicon and chip production, shortages through May could be a major blow to semiconductor production.A tumultuous road ahead for global markets