Microelectronics and information technology are the cornerstones of modern economies. The rise of these industries has sparked an industrial revolution, fundamentally changing society and the economy. Global leaders in microelectronics manufacturing play a critical role in driving technological advancement and economic influence in their countries. We take a closer look at which countries are leading the way in microelectronics, analysing the key factors behind their success.
↑ The chip era: Global trends in microelectronics
The development of information technology has sparked an incredible industrial revolution that is profoundly changing society and economies. Total IT spending in 2024 will be $4,997.7 billion, including telecommunications services, which have been almost entirely computerised for many years, and the semiconductor industry, whose main focus is IT and telecommunications equipment.
To understand how the economic sector works, it is useful to think in terms of a value chain. To produce an IT service or application, software and computers must be produced. To make software run on computers, you need to create an operating system. To build a computer, you need to produce electronic components. To produce microprocessors, specialised, highly sophisticated design software is needed. Next, the microelectronics industry relies on photolithography and optical equipment. Finally, at the very beginning of the process, silicon of the right quality must be mined and prepared in the right form.
↑ The US and microelectronics: Shaping the future of technology
As always, the US remains a key player in microelectronics, thanks to companies such as Intel, Qualcomm, Nvidia and Synopsys. Intel is the only company in the world that covers the entire microprocessor manufacturing process, from design to mass production. Synopsys, Cadence and Mentor Graphics dominate CAD development for microelectronics, providing critical infrastructure for the entire industry. A modern microprocessor consists of several billion transistors spread over an area of two to three square centimetres, and it is simply unthinkable to design its geometrical and electrical organisation ‘by hand’. That is why circuit description languages (VHDL, Verilog) and software for computer-aided design were developed.
The main, and practically the only, companies engaged in the development of electronic CAD are the American Synopsys (acquired by the Taiwanese SpringSoft, combined turnover - 3.3 billion dollars and 13,000 employees), Cadence (2.3 billion, 7,600 employees) and Mentor Graphics (acquired by Siemens, 1.3 billion, 6,000 employees). These computer-aided design systems are very expensive, not to mention the time it takes engineers to implement them.
↑ Why the World Depends on Taiwan: Microprocessors of the Future
Today, TSMC, a $35 billion global leader, is the only company making products in 7nm (nanometre) geometry, Samsung in 10nm, and Intel in 14nm. Next are three more companies that have given up the race for miniaturisation, but continue to bring more ‘rustic’ products to market. Here's how the ranking of the top companies looks in the end:
- TSMC
- Samsung
- Intel
- Global Foundries
- STMicro
- UMC
Microprocessor manufacturing is based on photolithographic processes performed by machines called scanners. There are three manufacturers of scanners in the world: Canon, Nikon and a Dutch company called ASML, which owns two-thirds of the world market worth about $12 billion. The most expensive part of a scanner is the lens, which looks like the lens of a huge camera. There are three manufacturers: Canon, Nikon and the German company Zeiss.
↑ South Korea: The leader in memory production
South Korea is the leader in memory (DRAM and NAND) production, thanks to Samsung and SK Hynix. These companies provide the majority of the global market for memory needed for smartphones, servers and personal computers. South Korea is also actively investing in the development of display and photolithography equipment, which strengthens its position in the global microelectronics industry. Building a modern microprocessor factory costs more than ten billion dollars, and its smooth operation requires several thousand engineers and technicians. Developing the production process and setting up the equipment requires time and skills, and only after a few years the success rate of production approaches 100 per cent.
↑ China: A growing giant
China is actively increasing its role in microelectronics. Companies such as SMIC (Semiconductor Manufacturing International Corporation) are looking to close the technology gap with Taiwan and South Korea. However, China is not yet capable of producing microprocessors with the most advanced technology, which limits its capabilities.
Microprocessor manufacturing is based on photolithographic processes performed by machines called scanners. There are three scanner manufacturers in the world: Canon, Nikon, and a Dutch company called ASML, which owns two-thirds of the world market worth about $12 billion. The most expensive part of a scanner is the lens, which looks like the lens of a huge camera. There are three manufacturers: Canon, Nikon and a German company called Zeiss. Microprocessor manufacturing requires specialised, highly sophisticated design software. Further, the microelectronics industry relies on photolithography and optical equipment. To date, China is not yet able to produce equipment at this level, and this remains a significant barrier to its technological independence.
One particular market segment is processors for military and aerospace applications, which must withstand space or nuclear radiation. To date, China has also had to rely on foreign technology for many strategically important components. Altis Semiconductors, for example, previously represented Europe's capabilities in producing processors for such environments, but since its disappearance, China has remained dependent on US suppliers.
↑ Europe: Laggards and possible prospects
In Europe, the main player remains STMicroelectronics, a Franco-Italian company with a strong position in analogue chips and sensors. However, overall, the European microelectronics sector is behind the US and Asia in microprocessor and memory production. To develop a new microprocessor requires several years (six or seven), a thousand to two thousand engineers and fifteen to twenty billion dollars to build a factory - an investment that Europe is rarely willing to make.
The only sector in which Europe remains at the forefront is the automotive industry, which, despite the recession, still benefits from microelectronics technology. Computer production in the region is limited because their assembly is a fully automated process with low added value. For example, it takes companies such as Dell less than three minutes to build a computer.
There are also no major players in Europe that could compete with American or Asian companies in the operating system market. In terms of installed systems, global leaders such as Microsoft and Google dominate, leaving Europe with only highly specialised or open source systems such as Linux and OpenBSD.
↑ Conclusion: The leading countries in microelectronics manufacturing are
The US, Taiwan and South Korea continue to set the pace of microelectronics development, shaping global technology trends. China is rapidly increasing its influence by investing in the development of advanced technologies. Europe, despite its capabilities, is still lagging behind, although STMicroelectronics remains an important player.
The future of microelectronics will depend on the ability of leading countries to adapt to challenges, including global competition, raw material shortages and geopolitical risks. These challenges will determine who will remain the leading player in this strategically important industry.
Wilfredo Huppert
Wilfredo Huppert is a war journalist with 25 years of experience. He has spent most of his life in military journalism, wars and military-political conflicts, treason investigations and much more.