Taipei, July 20, 2010 (CENS)--Fearing contracts from integrated device manufacturers (IDMs) will crowd out their contracts from silicon foundry suppliers in the brisk second-half with expected lucrative rewards, Taiwan`s analog IC design houses have accepted 10-15% price hikes asked by major foundry suppliers.

Heavyweight IDMs including Texas Instruments (TI), Infineon, National Semiconductor and On Semi are competing for foundry capacities at Taiwan Semiconductor Manufacturing Co. (TSMC), United Microelectronics Corp. (UMC) and Vanguard Semiconductor International Corp. (VSIC) in preparation for robust market in this and the next quarters with attractive prices.

To ensure enough foundry capacities for products in the second half, analog IC design houses as Richtek Technology Corp., Global Mixed-Mode Technology Inc., Anpec Electronics Corp., and Leadtrend Technology Corp. of Taiwan have accepted higher prices quoted by foundries.

Although some analysts are questioning forecasts of mobile-phone and PC markets entering boom seasons this and the next quarters, manufacturers still believe in a lucrative market as in past years in light of 20-30% more handsets, laptops and consumer electronics shipped by Taiwan`s manufacturers than in the same quarter last year.

Strong demand for these gadgets have driven up demand for analog ICs, compelling chip suppliers to extend lead time to 16 to 20 weeks due to capacity shortages.

Many IDMs have closed in-house 150-mm and 200-mm fabs since the global meltdown, compromising their ability to meet fast recovering demand, driving them to pure foundries for capacities.

(by Ken Liu)