Samsung steps up fan-out wafer-level packaging deployment

Julian Ho, Taipei; Jessie Shen, DIGITIMES Asia 0


Samsung Electronics has stepped up its deployment in the fan-out (FO) wafer-level packaging segment with plans to set up related production lines in Japan, according to industry sources.

Samsung has yet to respond to recent market speculation that the Korean chip vendor plans to invest US$75 million in constructing an advanced packaging and test line in Kanagawa, Japan, and is looking to enhance ties with Japan-based chipmaking equipment and materials suppliers.

Closer ties with Japanese semiconductor equipment and materials makers are part of Samsung's efforts to bolster its competitiveness against TSMC and Intel in the advanced packaging field, the sources indicated.

TSMC's strength is wafer-level packaging, with main customers willing to pay a premium for one-stop "risk management," the sources said. TSMC, as a pure-play foundry, is also easy to win customer trust and favor.

Industry observers are skeptical that Samsung would be able to catch up to TSMC in the advanced packaging area. Still, one of Samsung's benefits is its clout in the HPC heterogeneous integration supply chain, which includes carrier boards and memory.

While Samsung claims to be the first to enter the GAA generation in terms of wafer manufacturing process, there are still yield and customer adoption challenges that very much depend on its advanced packaging one-stop, the observers said. As a result, Samsung is motivated to grow its wafer-level technology capability and explore investing in FO wafer-level packaging.

The global FO packaging market is currently dominated by TSMC, which has grabbed a nearly 77% market share, according to sources at advanced backend service providers. TSMC has secured advanced packaging orders for both mobile and HPC device applications.

InFO_PoP, a derivative of TSMC's integrated wafer-level fan-out packaging (InFO) technology, for example, assisted the foundry in winning Apple's exclusive one-stop order from frontend manufacturing to backend. InFO_PoP remains the largest volume capacity representative of fan-out packaging technology, the sources said.

OSATs including ASE Technology (ASEH), Amkor Technology, and China's JCET also have their respective FO packaging technology, eyeing more orders for handset application processors, according to the sources. Among them, ASEH with its FOCoS and FO-EB packaging has cut into the supply chain of vendors such as AMD.

According to Yole Developpement, FO packaging revenue is expected to rise at a CAGR of 12.5% from 2022 to 2028.