A worker arranges an Intel logo at the CeBIT trade fair in Hannover March 13, 2016. [Photo/Agencies]

US semiconductor maker says nation outpacing world in chip production

Intel Corp said on Tuesday that it will step up efforts to grow its semiconductor manufacturing business in China, as the US chip giant brings advanced technologies to the country.

In its latest move to outcompete rivals such as Taiwan Semiconductor Manufacturing Co in the foundry business, which lets other chip makers use its semiconductor fabrication plants, Intel is bringing new technologies to China to tap into the local internet of things and mobile sector.

Zane Ball, vice-president of the technology and manufacturing group at Intel, said at a news conference that China consumed about 58.5 percent of worldwide chips, and it accounted for 25 percent of the global fabless industry.

Fabless manufacturing is the design and sale of semiconductor chips while outsourcing the fabrication (or "fab") of the devices to a specialized manufacturer called a semiconductor foundry.

"Both China's semiconductor production and consumption revenues continued to outpace those of the global market, further solidifying its position as a key player in the chip sector," Ball said.

Sensing the huge potential in China, Intel is bringing to local partners its 14-nanometer chip manufacturing technology and a new, low-cost technology called 22FFL, which can effectively make chips for low-power internet of things and mobile products.

Spreadtrum Communications Inc, a major Chinese semiconductor maker, is already leveraging Intel's 14-nanometer technology to produce mobile chips.

According to Intel, it is also making efforts to build a better ecosystem to support the foundry business, including offering design kits, silicon proven intellectual properties, as well as innovative chip package and test capabilities.

Intel is locked in competition with Taiwan Semiconductor Manufacturing Co and Samsung Electronics Co in the foundry sector.

Roger Sheng, a senior analyst at research company Gartner Inc, said Intel is expanding its presence in the foundry business, which can make the best use of its industry-leading production lines.

"But as it introduces more advanced manufacturing technologies to China, more efforts will be needed to upgrade existing plants. To reduce costs, it may also find a local partner to jointly establish a new factory," Sheng said.

On Tuesday, Intel also forcast that by 2020, China will produce about more than one fifth of global data and the market size of China's information communication technology sector will exceed $530 billion.