Samsung Electronics is buying up next-generation semiconductor manufacturing equipment that cost 200 billion won (US$176.52 million) per unit,
As Samsung Electronics buys up next-generation semiconductor manufacturing equipment that cost 200 billion won (US$176.52 million) per unit, the company is trying to gaining a competitive edge in the advanced technology of micro-processing lower than the 7-nanometer (nm).
According to industry sources on October 19, Samsung Electronics is considering a plan to purchase 10 extreme ultraviolet (EUV) lithography tools from the Netherlands-based ASML, the biggest semiconductor equipment maker in the world.
Samsung is now in talks to buy 10 EUV lithography tools and it is almost the equivalent to the total number of EUV lithography tools that ASML can be produced a year. ASML believes that it can produce about 12 EUV lithography tools this year. It is the only company that manufactures EUV lithography tools in the world.
Since Samsung Electronics has been exclusively buying next-generation semiconductor production equipment before its competitors, the company is seeking to overwhelm its competitors again with the same strategy, according to market watchers. In this regard, Samsung Electronics and ASML said, “We cannot officially confirm the fact.”
A EUV lithography tool, which is exclusively produced by ASML, is a next-generation semiconductor production technology that draws the pattern of semiconductor circuits on wafers using a light source. It uses the lithography technology using a 13.4 nm wavelength which is shorter than visible light. A EUV lithography tool is considered an essential equipment to realize the micro semiconductor process of lower than 10nm and to increase the supply of semiconductors.
ASML has developed EUV lithography tools since the beginning of 2000 with support of Samsung Electronics and Intel. When applying a lower than 10nm process to existing semiconductor equipment, the stages of process will increase and dramatically decrease productivity. Samsung Electronics, Intel and TSMC have cooperated with ASML, which have been developing EUV lithography tools from years ago, to seek out alternatives.
Samsung Electronics’ latest move is believed to be part of its strategy to give its competitors a slip by exclusively purchasing most of EUV lithography tools to be produced for a year. When Samsung Electronics buys one year’s output of lithography tools from ASML as it planned, the company can preemptively prohibit TSMC, GlobalFoundries and Intel, which are its competitors and potential buyers of EUV lithography tools, from entering the next-generation semiconductor production process.
Samsung Electronics kept its competitors in check with a similar strategy before. The company exclusively bought most of “organism evaporation equipment” that is used in the core process of mobile organic light-emitting diode (OLED) display panel production from Japan’s CanonTokki for years. CanonTokki, the world’s largest OLED evaporation equipment producer, can only sell a single digit of equipment units per year. This was why LG Display had trouble starting mobile OLED display business, while Chinese companies had difficulties in receiving the supply of evaporation equipment from CanonTokki.
Meanwhile, Samsung Electronics sold a 1.5 percent stake, half of its 3 percent stake, in ASML last year. So, some said that Samsung Electronics and ASML decided not to jointly develop EUV lithography tools and introduce systems. However, Samsung Electronics denied rumors at the earnings conference call in the first quarter this year, saying, “The System LSI division aims to start production using the 7nm process in early 2018 and will use EUV lithography tools in the process.”