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2015: A turning point for the semiconductor industry?

Track: CASE

Keywords: Semiconductor industry, Moore’s law, Competitive analysis, Value chain

In the middle of 20th century, two important inventions gave birth to a new industry – the semiconductor industry. The prevalence of electronics in almost all the parts of modern life is a manifestation of the tremendous success of the semiconductor industry in a very short span of time. The microelectronics industry, a more common name for the semiconductor industry, pertains to design and manufacturing of all kinds of electronic chips found in various devices and appliances. The primary manufacturing material of a typical electronic chip is silicon, which is a type of a semiconductor, hence the name. The case will discuss the background behind the inception of this industry followed by an important phenomenon called Moore’s Law that has been observed throughout the evolution of the industry. The case will also explain briefly the manufacturing process of an integrated circuit, a technical name for a microelectronic chip. After laying the groundwork for readers not very familiar with the industry, the case will delve into basic industry facts, such as market size and segmentation, used by industry analysts. The case can help readers analyze the stage of the industry’s life cycle and overall competitive arena including strategic positioning of major industry players. The external analysis of the semiconductor industry considers macro-environment (demographic, sociocultural, economic, political, technological, and physical environment) trends as of 2015. The case will discuss the value chain in the semiconductor industry and associated evolution of the various business models practiced by industry players over the years. Competitive forces in the industry are explained, encouraging readers to judge the strength and influence of those forces on current and aspiring players in the industry. The external industry analysis is augmented with description and brief internal analysis of some of the key players in the industry, positioned at different stages in the supply chain. The case provides a rich context for analysis of the semiconductor industry, and helps readers identify the various opportunities and threats for incumbents and new entrants as well as strengths and weaknesses of the successful players in the industry.


Gaurav Patwardhan -
North Dakota State University

DelRae Chivers -
North Dakota State University

Karen Froelich -
North Dakota State University


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