© kasia biel Business | October 20, 2016

Foxconn looking to dive into the chip market

EMS-giant Foxconn is reportedly looking to expand its business in the semiconductor industry by teaming up with SoftBank Group-owned ARM to build a new chip design center.
Foxconn is planning – along with ARM – to build a chip design center in Shenzhen, according to a report in Nikkei Asian Review citing people familiar with the matter.

This details the company’s ongoing efforts to manufacture more key components tap into new technologies where it can achieve future growth as global demand for smartphones weakens.

"We want to get into semiconductor design and production," Foxconn Chairman Terry Gou told Shenzhen Satellite TV last week, according to Nikkei.

This could be a positive for the EMS-giant, that is if the company manages to minimize its financial exposure to semiconductor production, as well as designs the right types of chips, Bloomberg states in a report.

In regards to the “right type of chips”, there is little to no chance for the company to compete with Intel and Samsung in processors, neither could it rattle Qualcomm when it comes to communication chips. But then we have application-specific integrated circuits (ASICs). As both Nikkei and Bloomberg states; there is a huge market for ASICs – and Foxconn has been trying to develop its own for awhile. But there is also ASSPs, a chip made for a dedicated function, for example one that operates the USB port in your phone or laptop.
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