Experts have suggested that AI technology, which has transformed the semiconductor paradigm, will determine dominance, and that semiconductors will be a key determining factor.

Lee Seung-woo, Head of Research at Eugene Investment & Securities, discussed domestic and international semiconductor industry trends and future prospects, including AI semiconductors, at the ICT Industry Outlook Conference held on the 3rd and 4th.

In his presentation, the center director argued, “As comprehensive semiconductor system design capabilities become increasingly important, AI semiconductor technology—which stores and processes data—is expected to rise in value as a core strategic resource for humanity.”

The semiconductor industry, which began in earnest in the 1990s, gradually underwent a division of labor, leading to the emergence of specialized companies such as fabless and foundries. In particular, while Samsung’s non-memory revenue accounted for 88% of TSMC’s total revenue, it was found to have fallen to a mere 33% share in 2021.

Ultimately, the semiconductor paradigm has shifted, with the top spot in operating profit among semiconductor companies—which had been the exclusive domain of Samsung Electronics and Intel—turning to TSMC as of this year. The value added of fabless and foundry companies rose from 8% in 2000 to over 30% in 2021, showing higher growth potential than the overall semiconductor industry.

The center director suggested, “Strategic decisions are needed to resolve this, and ultimately, comprehensive system design capabilities are crucial for the advancement of semiconductor design capabilities.”

Increasingly, many companies have ventured into semiconductor design to secure their own competitive edge. For instance, Apple and Samsung have developed their own smartphone design capabilities, and Nvidia has also expanded its semiconductor design capabilities to maintain the competitiveness of its graphics card products.

Meanwhile, the competitive factors for foundries lie in process technology, customer base, and ecosystem. The center director stated, "It is important who has more capable customers," and suggested that "the roles of design houses and back-end process companies specializing in packaging and testing will become particularly important."

To strengthen the foundry business, it appears necessary to establish a long-term plan to enhance the competitiveness of domestic design houses and back-end process companies.

■ The Key to Future Technology, AI Semiconductors

The center director argues that the key to this future semiconductor technology hegemony lies in AI.

Since the dawn of the third-generation AI computing era, AI has completely shifted the paradigm of familiar programming methods. Companies have embarked on expanding data center investments and Big Tech firms acquiring AI companies.

The United States imposed sanctions on China, controlling its entire export of semiconductor equipment and AI chips. This appears to be a cautious stance regarding China's growth in AI value added, and with Samsung Electronics and SK Hynix granted a grace period for separate consultations, additional investment by domestic companies in production facilities in China is expected to shrink.

Meanwhile, in Korea, Samsung Exynos 2100 and SKT Sapeon X330 are striving to develop domestic AI semiconductors, and KT and domestic startup More are collaborating with AMD to aim for the launch of their own NPU in the second half of 2023.

The center director added, “Managing the overall AI ecosystem is important for the AI industry to grow more fundamentally.”

In addition, while the semiconductor industry as a whole is contracting in the short term due to the recent economic downturn, AI technology is expected to show double-digit growth, and he added, “It is the area we are focusing on the most, and it could become a breakthrough for the Korean semiconductor industry in the future.”

As the conflict between the U.S. and China continues, hegemony is ultimately driven by the superiority of systems and technology, and AI is expected to become increasingly valuable as a major resource.