Taiwan plays an increasingly important role for Micron Technology, which is ramping up production for its DDR4 DRAM chips built using 1znm process technology at its fab in Taichung. Meanwhile, robust demand for enterprise-use notebkks in the wake of the coronavirus pandemic has given notebook chip suppliers clear order visibility through third-quarter 2020. And despite the pandemic creating pains for the handset market, VCSEL chip demand for 5G applications and smartphones is believed to be heading towards stable growth in the long term.Micron ramping 1znm DRAM chip output in Taiwan: Micron Technology has gradually scaled up production of DDR4 DRAM chips built using 1z-nanometer process technology at its factory site in central Taiwan, according to sources familiar with the matter.Commercial notebook chips order visibility clear through 3Q20: Taiwan-based IC design houses continue to see an influx of additional orders from major brand vendors, with clear order visibility for diverse niche and peripheral chips extending to late third-quarter 2020, according to industry sources.VCSEL chips demand on track for stable expansion: Vertical-cavity surface-emitting laser chip demand for 5G base station equipment, networking devices and even optical communications applications has got on track for stable expansion, serving as long-term revenue support for the supply chain, according to industry sources.

Taiwanese researchers have developed an explainable AI module that can explain reasons behind results of facial recognition.MOST Joint Research Center for AI Technology and All Vista Health Care at National Taiwan University (NTU), an AI research center established at NTU and sponsored by Ministry of Science and Technology (MOST), on May 11 unveiled its explainable AI module xCos.Currently for AI-based recognition, data input and results are known, but the criteria for and process of judgment leading to the recognition results are unknown, said NTU professor Winston Hsu, leader of the xCos project sponsored by MOST.xCos can explain reasons behind results of AI facial recognition and can help developers of AI-based recognition technologies inspect mechanisms of recognition systems to see whether the judgment is reasonable and thus improve the systems, Hsu noted.xCos can be generally matched with AI-based facial recognition systems, Hsu said, adding the AI research center is also promoting application of xCos to AI-based decision making other than facial recognition. For example, when AI-based decision making predicts that a power plant will increase power generation in the next hour, xCos can explain that this because the weather conditions have changed or there will be festivities.Hsu won first place at Disguised Faces in the Wild competition at a 2018 conference on Computer Vision and Pattern Recognition taking place in Salt Lake, Utah, with overall accuracy of over 90%.MOST minister Chen Liang-gee in disguise testing AI-based facial recognitionPhoto: MOST

Notebook demand may be robust at this moment to support stay-at-home needs in the wake of the coronavirus pandemic, which nevertheless is casting a shadow over third-quarter 2020 outlook for notebook ODMs. The pandemic has worsened Washington-Beijing relations with the Trump administration now reportedly increasing pressure on TSMC to build wafer fabs in the US, but the Taiwan-based foundry house has maintained it has no plans to build one in the US. For PCB maker Unimicron, order visibility for ABF substrates is clear through at least the third quarter, but thee is still a chance that clients may postpone product launches due to the pandemic.Notebook ODMs see clouded 3Q20: Notebook ODMs Quanta Computer, Compal Electronics, Inventec and Wistron are all expected to enjoy strong shipments in the second quarter, but prolonged impacts from the coronavirus pandemic have cast a shadow over their shipments in the following quarter, according to sources from the upstream supply chain.No specific plans yet for US fab, says TSMC: TSMC has always been evaluating potential locations for an advanced wafer fab overseas, including the US, but no specific plans have been put in place yet, according to the pure-play foundry.Unimicron embraces brisk orders for ABF substrates: Unimicron Technology has seen clear order visibility for ABF substrates at least through the third quarter, with the orders mainly for 5G infrastructure, networking and HPC chips applications, according to the Taiwan-based IC substrate and PCB maker.

Asustek is a clear market leader in gaming smartphones, but it is seeing growing competition from others. Lenovo reportedly has headhunted a key executie from Asustek' ROG Phone team, in a bid to accelerate its development of gaming smartphones. In the PCB market, Taiwan-based Zhen Ding and Unimicron have been keen to extend their leaderships over competitors by planning to spend big on technology R&D and production capacity expansions, despite the coronavirus pandemic, which has deterred others from making major investments. But the pandemic is expected to affect sales at Taiwan's three major pure-play foundry houses in the second half of 2020. Digitimes Research has cut its full-year forecast for Taiwan's foundry sector.Lenovo fast tracks gaming smartphone biz by headhunting talent from Asustek: Lenovo is set to unveil a new gaming smartphone later in May as the company has recently headhunted a key executive from Asustek Computer's ROG Phone team and seen its R&D capability of gaming smartphones significantly enhanced, according to sources from the upstream supply chain.Zhen Ding, Unimicron looking to extend lead over peers via bold capex injection: The coronavirus pandemic may force many Taiwan-based PCB makers to slow down their capacity expansion plans in the short term due to uncertain market prospects, but Zhen Ding Technology and Unimicron seem unaffected and will see their capital expenses hit new highs again in 2020 seeking to further strengthen their market and technology leaderships over peers in the longer term, according to industry sources.Digitimes Research cuts Taiwan foundry output value forecast for 2020: Digitimes Research has revised downward its Taiwan foundry output value forecast this year, as end-market demand is likely to disappoint due to the prolonged pandemic.

Notebook demand has been so strong in the wake of coronavirus lockdowns that related IC suppliers have not been able to catch up due to insufficient foundry support. Delivery for a host of notebook-use ICs has extended by 2-3 months. Such robust demand has also shored up revenues for notebook ODMs. Inventec has reported its April revenues grew almost 26% on year. Meanwhile, TSMC has reported its April sales dropped over 15% sequentially but rose more than 28% on year. TSMC's revenues for the first four months of 2020 surged almost 39%. Lead time for notebook chips extended on tight foundry capacity: Delivery lead time for notebook-related chips including power management ICs, Type-C chips and other peripheral ICs have been extended by 2-3 months, due mainly to tight 8-inch foundry capacity, according to industry sources.Inventec enjoys double-digit revenue growth in April: Inventec has reported revenues for April 2020 climbed 17.6% sequentially and 25.7% on year to NT$49.29 billion (US$1.64 billion), as its shipments for notebooks and servers grew robustly.TSMC posts decreased April revenue: TSMC has reported April consolidated revenue fell 15.4% sequentially to NT$96 billion (US$3.21 billion).

Taiwan's shipments of small- to medium-size LCD panels will continue drifting downward in the second quarter of 2020 in the wake of coronavirus pandemic, with a-Si feature phone applications to be affected the most, according to Digitimes Research.Shipments of small- to medium-size panels by Taiwan's makers fell 28.4% sequentially and 8.8%% on year to 168 million unit in the first quarter 2020, as China-based handset makers were unable to fulfill their shipments due to the outbreak, cutting panel demand.As a result, Taiwan's shipments of handset applications decreased 34.4% sequentially in the first quarter, while those for other medium-size (including smart speakers) and tablet applications sank 14.1% and 14.6%, respectively.Although the outbreak has eased in China and its handset makers have resumed their operations mostly, shipments of handsets, particularly entry-level and mid-tier features phones, to India and other emerging markets remain difficult in the second quarter due to an escalation of the pandemic in these areas.With panel demand from Chinese handset makers likely to remain conservative, Taiwan's panel suppliers are expected to see their shipments of small- to medium-size panels drop another 4.4% on quarter and 10.4% on year in the second quarter, Digitimes Research estimates.Handset panels alone will sink 12.4% sequentially to below 100 million units in the second quarter, but those for tablet applications are likely to shoot up 36.8% amid rising tablet demand supporting remote study.

AI startup business Ubestream has launched AIchatin SaaS (software as a service) cloud computing platform for providing AI-based dialog robot services on a subscription basis.Using semantic deep learning and machine learning technologies available at Microsoft Azure, AIchatin is an engine that allows subscribers, via opening accounts at an AIaaS (AI as a service) provider, to introduce its AI-based automatic dialog functions to their websites, Facebook Messenger or Line to operate question & answer customer services, the startup firm said.This enables enterprises, retail operators, e-commerce operators, government organizations and schools to provide web-based voice inquiry services without establishing their own AI-based automatic dialog systems, Ubestream indicated.

Alibaba's subsidiary Pingtouge has devoted much effort developing AI and server chips. Pingtouge has been as keen to develop ties with TSMC, and has the potential to become one of the foundry house's major clients. Meanwhile, Alibaba and other China-based cloud service providers are ramping up demand for enterprise servers and SSDs, as the country lifts coronavirus lockdowns. While it remains uncertain whether Apple's 5G iPhone will come out later than usual, its FPCB suppliers have seen demand turn strong in the second quarter, thanks to the roll-out of the next-generation iPhone SE, new iPad and MacBook models.Alibaba chipmaking subsidiary to emerge as major client of TSMC: Pingtouge, Alibaba's semiconductor subsidiary, has stepped up its AI and server related chip development while extending its ties with TSMC and Global Unichip, and has the potential to become a major client of the foundry house, according to industry sources.China cloud service providers ramping up demand for memory: China-based cloud service providers have stepped up their purchases of server memory and SSDs since the second quarter of 2020, according to industry sources.Taiwan FPCB makers see demand turn strong for Apple devices in 2Q20: Taiwan's flexible PCB makers in the supply chain of Apple devices have seen demand turn strong in the second quarter of 2020 to support robust sales of second-generation iPhone SE, new iPad and MacBook models, according to industry sources.

Shipments of LCD TVs by Taiwan-based makers fell 45.2% sequentially to 4.65 million units in the first quarter of 2020, affected mainly by seasonality and the outbreak of the coronavirus pandemic in China, according to Digitimes Research.Taiwan's TV shipments to the North American market were less affected by the pandemic and the off-peak season effects in the first quarter. The ratio of shipments to North America rose to 39.4% of overall Taiwan volumes in the quarter from 38.1% a quarter earlier, Digitimes Research figures show.The shipment proportion of TV models sized above 50 inches fell to 44.3% in the first quarter compared to over 50% in the previous quarter, while the ratio of models ranging from 32-39 inches increased significantly during the January-March period.Meanwhile, the proportion of 4K models also declined to 50.6% in the first quarter.TPV Technology was the top vendor among Taiwan-based TV makers in the first quarter, taking up a 43.7% market share, and it was followed by Foxconn Electronics, Amtran Technology and Innolux.Looking ahead, Taiwan's TV shipments are expected to experience an annual decline of 42.4% to 4.13 million units in the second quarter 2020 as the pandemic has spread into Europe and the US hurting global economic growth and undermining demand for TVs, Digitimes Research estimates.

Chassis maker, as an important supplier for Apple, is mulling plans to move production to Southeast Asia, with rumors claiming the maker is looking to sell its plants in China. This may be an inidcation that Apple's supply chain partners are getting serious about relocating their production lines out of China at the behest of the client. But the handset supply chain will remain heavily reliant on China. Chinese handset ODM Wingtech and components maker Luxshare have reported strong results for first-quarter 2020 despite sluggish demand in China's handset market in the wake of the coronavirus outbreak. The pandemic, however, has triggered huge demand for stay-at-home support that in turn driven up sales for DRAM maker Nanya and players in the healthcare MCU and server chip supply chains.Catcher reportedly mulling setting up factory site in Southeast Asia: Chassis maker Catcher Technology with manufacturing operations mainly in China reportedly is evaluating the feasibility of setting up a new plant in Southeast Asia to cope with Apple's demand of shifting the upstream supply chain capacity to outside of China, according to industry sources.Chinese handset ODMs enjoy ramp-up in lucrative orders: Chinese handset ODM Wingtech Technology and components maker Luxshare Precision Industry have posted significant on-year revenue and profit increases for the first quarter of 2020, despite sluggish domestic demand in China.Nanya revenue hits 18-month high: DRAM chipmaker Nanya Technology saw its revenues climb to an 18-month high of NT$5.62 billion (US$188.2 million) in April 2020.OSAT firms see robust demand for healthcare MCUs, server chips: Strong demand for healthcare MCUs and commercial notebook chips driven by the coronavirus pandemic has significantly boosted capacity utilization at Taiwan's backend houses, with clear visibility of packaging orders from vendors of both logic ICs extending to July, according to industry sources