Eurocontrol Technics Ord EUCTF

Samsung Spending $Billions$ On Semiconductor Equipment

[homerunstock]

Samsung matching Intels scale During the computer era, the Intels strengths complemented one other, but now in this mobile age, manufacturing expenses have grown so large that setting up a product line is risky. Researchers at IHS estimate that a chip plant with the latest production equipment costs almost $10 billion. Most of the cash goes to buy machinery, which depreciates over theyears and has to be replaced to remain competitive. Also device makers want fewer suppliers to provide them with more pieces of the final product. Samsung, by striking deals to produce chips designed by Apple and Qualcomm, has turned the problems to its advantage, says Bloomberg. Len Jelinek, an IHS analyst, says, Historically, Intel has had a huge R&D budget that couldnt be challenged by anybody, but Samsungs Budget represent the first real competitive effort. Intel and Samsung are spending $12 billion a year on research and development as they try to devise more efficient chips.On one hand, where Intels plan is to introduce its latest mobilechipsand modems in time, Samsungs goal is to take on Intel in the chip market. Its difficult to say when well achieve our goal, says Samsungs head of logic chips Kim Ki Nam.