Image Source: DIGITIMES
In the IC design industry in Taiwan, driven by the growing demand for artificial intelligence applications, the scale of the application-specific integrated circuit (ASIC) market is rapidly expanding. MediaTek has entered the supply chain for Google’s Tensor Processing Units (TPUs), while WorldChip Technology has secured new projects with Amazon Web Services, and Global Unichip Corporation (GUC) continues to win new orders. Market reports indicate that GUC has secured a complete backend one-stop order for Tesla’s AI5 chip, expected to contribute to revenue starting in 2027.
In addition to these significant projects, Novatek Microelectronics, Realtek Semiconductor, and many mid-sized design companies are continuously undertaking a large volume of computing-related ASIC business. This shift highlights the increasing influence of Taiwan in a niche sector that was previously dominated by small firms with stable customer bases.
Industry veterans indicate that in the past, manufacturers rarely took the initiative to engage in ASIC business. Most design companies only undertook related work when customers requested it, and their involvement was often limited to design support or intellectual property licensing. Compared to self-developed platforms, ASIC business has lower profit margins, and since the final chips belong to the customers, manufacturers do not gain brand benefits, which has led to a lack of enthusiasm for this business.
Today, the market environment has undergone significant changes. The continuous growth in demand for AI computing has driven cloud service providers and AI developers to surge in demand for high-performance ASICs. At the same time, new ASIC application opportunities have emerged in areas such as edge computing, automotive, industrial control, drones, and displays. Many rapidly growing overseas system manufacturers lack supply chain expertise and require custom chips to meet specific functional needs.
Design companies indicate that the widespread participation in ASIC business reflects the true expansion of demand in this field, including some previously unrealistic or non-existent application scenarios. Companies in Taiwan possess a rich portfolio of intellectual property, and apart from cloud AI chips, expanding ASIC services does not require significant additional capital investment. More critically, Taiwan has a highly integrated semiconductor supply chain, making its local design companies the preferred partners for overseas customers seeking end-to-end support.
Many ASIC customers now prefer to choose complete one-stop solutions. Taiwan’s long-term collaborative layout in design, wafer manufacturing, packaging, and testing enables its local manufacturers to efficiently provide such solutions. Although global giants like Broadcom and Marvell closely collaborate with Taiwan, local companies in Taiwan still have advantages over mid-sized ASIC and intellectual property firms in other regions—greater production visibility and tighter supply chain collaboration, which accelerates the establishment of customer trust.
Recent discussions indicate that customers consider a manufacturer’s ability to secure manufacturing capacity as a key factor when selecting ASIC partners. Especially for advanced process products, some customers believe that companies in Taiwan are better positioned to secure cutting-edge process and advanced packaging capacity quotas, which also influences their procurement preferences. In some cases, large customers even expand their list of ASIC suppliers to diversify their access to scarce production capacity.
Original Title:Taiwan’s IC Design Edge in ASIC Development
Original Media:digitimes asia
