SMIC Research Of The Present Situation And Future Based On China Semiconductor Development

China semiconductor evolution takes off rapidly from Y2000 and become the future star in world semiconductor market. Due to china semiconductor's affinity with china politics and inner demand market, this paper starts from the history of china semiconductor. To divide IC industry into IC design, IC manufacturing and IC testing & assembling three major portions for analysis. The characteristics of current china semiconductor industry is small head with big tail, means 50% above IC market is occupied by testing & assembling with low entrance level. The portion of IC design is relatively small as the result from the lackness of technology and manpower. How to refrain from producing low price product, generate high profitable and increase competitiveness with World renowned Manfacturer, technology improvement and groom talent develop are the same directions for moving better.Wafer fabrication growth is the speediest one among china semiconductor in recent year. There are 4 chinese companies occupied 13% worldwide market according to Y2006 wafer fabrication ranking. SMIC, established by Richard, R, Chang in April Y2000 is the most remarkable one. It was recorded to the 3rd wafer fabricaton company in Y2005 and shows positive profit in same year. But drop to the forth position as the result of recession and unproper product mix. The main reasons for quick ramp up are:(1)The major contribution comes from china government support and Taiwan experienced management team;(2)Capacity exchange to order, stock options exchange to technology"are the key source of smic order and technology;(3)The strategy of"Expansion"and"Enhancement"works while the boom of the world market.By means of inner and outer environment analysis, SWOT and core competition analysis, the advantage of smic is the support from china government and the backup of fertile china market. The 3 main threaten to smic are low-end technology, unproper product mix and capital leakage for quick expansion.The success of SMIC is highly related to"China"factor. Taking the advantage of"china characteristic"to compensate its weakness of capital, talent and technology will be the main topic for SMIC future development. Suggestion as below:1. To consolidate the strategy of foundry and improve product combination.2. To expand capacity with thourough consideration of capital issue and reap while the circular semiconductor boom reveals.3. Enhancing turnkey service and pay attention to the sobriety of diversified development.The prospect of smic with continuously growing is affirmative if smic can take the advantage of the low cost, government support and fertile market demand.