Contributing Editor WaferNews
Asian giant China may be getting the lion’s share of attention as an up-and-coming semiconductor powerhouse, but relatively tiny neighbor Korea is quietly establishing itself as a potential provider of tools and materials, with a plethora of increasingly sophisticated toolmakers at home within the country’s borders.
Several of Korea’s growing equipment and materials firms (including Atto Co. and E.O. Technics, for example) are seriously eyeing the China market for new offices, plants, and expansions.
Besides the well-known joint ventures with US and Japanese companies, and the local Korean makers of test and assembly equipment, there are now a growing number of domestic companies moving upscale to more advanced materials and front end equipment, such as coater/developer and CVD systems. These are increasingly exporting their low-cost tools to the rest of Asia.
Samsung seems to have largely created this local industry, with its willingness to work with new young companies. Many Korean vendors interviewed by WaferNews said they developed their technology with Samsung, and some of their executives came from Samsung as well. “Samsung is the oldest company,” noted Wesley W. Min, COO of Dongbu Electronics. ” People there saw the opportunities earlier.”
One of the fastest growing local suppliers is Dongjin Semichem, whose electronic materials sales reached $58 million (W74 billion) last year, thanks to strong demand for its LCD materials like resists and strippers, which account for about 60% of revenues. But the company is also strong in resist strippers for semiconductors and is introducing CMP slurries and advanced semiconductor resists. “We expect 30% growth this year,” said Jae-Hyun Kim, Electronic Materials Division manager. “We were up 40% in the first half, but it will be less in the second half with the problems at Hynix.” He said major semiconductor companies in the US and Taiwan are evaluating its 193nm resist samples, based on technology licensed from Hynix and developed with that company. Now less than 10% of revenues come from exports, but the company is considering opening a plant in Taiwan in November. Kim says Samsung just qualified the company’s new pigmented photoresist for color filters for the displays for its personal digital assistants.
Gas cabinet maker Atto Co., which says it dominates the Korean gas supply market with 75% share, is expanding into new fields with a new plasma cleaner for ball grid arrays and other advanced packaging applications, and next year plans to introduce a PE-CVD system, now in demonstration at Samsung for 0.14}mum devices. “We can control uniformity very well, by controlling the gap and the gas flow rate,” said new company President Sang Young Moon, a 23-year veteran of Samsung. Already a big exporter, Atto gets 75-80% of its $45 million (W50 billion) annual revenues from exports to SE Asia, and is looking eagerly at the China market. The company also has a new distributor in the US.
“And we’re looking for a partner there,” said VP Heemok (Mike) Park.
DNS Korea not only has a local manufacturing plant for Japanese parent Dai Nippon Screen, but now says it has developed its own local 300mm spin scrubber that’s been sold to Samsung, Hynix, Dongbu, and Anam. “We’re developing our independent technology for 12-inch equipment,” said Jin-yeal Yang, assistant sales manager. “We worked with Samsung. We may well sell it overseas next year.”
KDNS sales are also supported by the growing Korean LCD manufacturing base. The company gets 30% of its $80 million (W100 billion) revenues from LCD equipment. It claims 35% of the Korean market for spinners, 40% for wet stations, and 90% for spin scrubbers.
Another growing player in the front end equipment business is Silicon Tech, whose president Saint Woo worked at Tokyo Electron in Korea for eight years before founding his own company. Woo reported that his company can make its coater developer modules 30% cheaper than its competition by using all standard parts. “We’ve sold 25 systems in the last eight months,” said Woo, to major Korean companies and to Taiwan, Japan, and the US. Woo said he currently expects sales to remain about level this year, as increasing sales in new fields like optical and indium phosphide counter the dismal memory market.
Other Korean toolmakers with big export business include E.O.Technics and M.A.T. Laser toolmaker E.O. Technics gets more than 60% of revenues from exports of its laser markers to SE Asia, and it was recently touting its new wafer-scale system for marking the entire back of the wafer. Coming next is a laser cutting tool for molding compounds to replace saws. The company is opening a new office in Shanghai this month. Little $7 million (W9 billion) M.A.T. also gets more than 50% of its revenues from overseas sales, with 120 of its gas scrubbers installed in Taiwan and more than 20 in the US, at customers like IBM and NEC.
The breadth and strength of the country’s chip processing industry was made evident recently in Seoul at SEDEX 2001, Korea’s own homegrown semiconductor equipment show. Roughly a hundred local companies displayed an increasingly sophisticated range of tools and materials to a respectable crowd of attendees.
“While Semicon Korea is international, this show is Korea only,” pointed out Atto President Sang Young Moon.
Indeed, except for a few joint ventures, almost all the booths housed Korean companies. Among the busiest booths were those of the burgeoning support industry of local suppliers of components and subassemblies to the local toolmakers – linear motors and stages, valves and flowmeters, quartzware, lasers, etc.
Still, Korean equipment sometimes remains a hard sell, even in Korea.
“Korean equipment is okay for simple machines like ashers and ovens,” says Dongbu’s Min, who has just equipped his company’s new foundry. “But we don’t know the reliability of Korean equipment.”