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In an effort to validate our vision that a significant portion
of semiconductor revenues would be derived from fabless operations
by 2010, GSA has collaborated
with Morgan Stanley to produce a report on outsourcing trends.
We feel it is important to articulate and quantify the demand
from outsourcing operations to ensure there will be sufficient
wafer capacity to support the growth from fabless companies
and integrated device manufacturers (IDMs) that are committed
to outsourcing (the hybrid model). It is anticipated that
this report will be the first step in providing the industry
with an 18-month rolling supply and demand forecast. GSA
expects to work with Morgan Stanley and other third-party
research groups to publish this ongoing forecast.
As a foundation for this effort, GSA provided Morgan Stanley
with its aggregate data and insights on semiconductor companies.
Mark Edelstone, a managing director at Morgan Stanley, and
his semiconductor research team, validated the data and then
analyzed the semiconductor outsourcing business model to forecast
its growth. Morgan Stanley addressed this forecast from two
methodologies:
- Top-down – Morgan Stanley segmented the companies
into groups and, using industry data, forecasted growth
for those segments. It then estimated process technology
transitions through 2010 and input gross margin estimates
to forecast the cost of purchasing wafers at each process
node.
- Bottoms-up – Morgan Stanley projected growth rates
through 2010 for more than 75 global semiconductor companies.
It then forecasted outsourcing ratios, using data from company
inputs and Morgan Stanley estimates and input gross margin
estimates to forecast the cost of purchasing wafers at each
process node.
Finally, using foundry wafer pricing trends with gross margins,
Morgan Stanley estimated the silicon area that would be in
demand by 2010.
GSA’s goal is to provide reliable information on
outsourcing trends and provide our members with reports they
can utilize and rely upon. We canvassed members and industry
leaders to understand what is most beneficial to our members.
GSA is working to create a more reliable measure of global
supply and demand by continuing the research and forecasting
identified in this report by Morgan Stanley. We will address
the supply forecast through a combination of company surveys,
third-party capacity data and equipment capital expenditures.
Through our collection of primary and secondary research,
collaboration with industry experts, numerous committee initiatives
researching industry issues and a strong network of supply
chain integrators, GSA is the leading voice and expert
on the fabless business model. At more than 425 members worldwide,
GSA continues to seek new and innovative ways to support
members with accurate information they can use to make sound
business decisions. Our success is attributed to our reputation
for being responsive to member feedback and to providing strong
member value. Ultimately, we measure our accomplishments by
the success of our members and that of the business model.
Download the Report (For Members Only, Adobe PDF File, 340KB)
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