TAIWAN: According to IDC, as Taiwan's semiconductor market experiences moderate growth rate through 2012, investing and acquiring will be key for suppliers.

The overall Taiwanese semiconductor market grew 2 percent in 2007, slower than the worldwide semiconductor market, and will continue to expand at a moderate CAGR of 1.2 percent through 2012. While computing will remain the largest semiconductor segment in Taiwan, accounting for 55 percent of the demand by 2012, automotive will be the fastest growing segment.

Key findings
* Foundry and DRAM are still the two key areas of manufacturing for Taiwanese semiconductor suppliers.
* Taiwanese fabless suppliers continue to focus on domestic and Chinese market.
* Taiwanese suppliers ASE and SPIL account for 50 percent of the Taiwanese testing and assembly market.

Opportunities and challenges
* Taiwanese suppliers must invest in software to compete in the future at a platform level against the global IDMs and fabless companies.
* Taiwanese suppliers must become more active in acquiring and forming new partnerships. Taiwanese DRAM suppliers, which struggle to enter the 8-inch foundry market, will be forced to consolidate.
* Taiwanese suppliers must take advantage of easing technology restrictions and engage more actively in the development of Chinese-driven technology standards.