The global semiconductor market may be seeing a return to profitability, but it is also consolidating and making the market much tougher for new entrants, according to Intel.
Andy Bryant, Intel's executive vice president of manufacturing and enterprise services, said that the market had changed radically in the past five years as new companies came to dominate the market.
"The foundry market is more unsettled than it's been in years. It used to be simple: if you wanted to build a chip you went to a few key suppliers," he said.
"Now you have Korean, Chinese and Taiwanese companies getting in, the latter of which still dominates. This is the area where nationalistic investment money is going."
The top five semiconductor companies now take 50 per cent of all revenue in the market, compared to less than 30 per cent in 2004, according to Bryant.
And the same companies - Samsung, Intel, TMC, Global Foundries and Toshiba - are responsible for half of the new investment in manufacturing.
Bryant explained some of the cost barriers to getting into chip manufacture. A modern fabrication plant costs around $4.5bn (£3bn) to build, another $1bn to $2bn (£665m to £1.3bn) to run a pilot chip line, and then up to $1bn (£665m) to invent the production process.
The cost of new designs has also been rising steadily, meaning that new designs are at their lowest levels in years.
"There is no free way to do business anymore. It's all hard work," he said.
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