[EDITORIALS]Semicon war aheadChallenges against the Korean electronics industry are sprouting across the globe. U.S. semiconductor makers Intel and Micron have jumped onto the NAND flash-memory chip bandwagon by forming a venture called IM Flash Technologies. Five Japanese chip makers such as Toshiba, NEC and Hitachi have decided to jointly set up a next-generation semiconductor plant. The initial investment for each alliance well exceeds several trillion won. Those U.S. and Japanese moves suggest that they cannot tolerate Samsung and Hynix running ahead in the NAND flash market, which has recently emerged as a gold mine after demand began surging for mobile phones and portable MP3 players.
The challenges from the United States and Japan are not to be regarded as a simple issue. The combination of Intel’s financial resources and processing technologies with Micron’s advanced technologies in memory is feared to bring unpredictable changes to the industry. Japan’s move to recover its past glory as a great power in the semiconductor sector should not be ignored. A brief moment of overconfidence can reverse the situation, as has been seen in the short history of the semiconductor industry. Not only for the sake of Samsung Electronics and Hynix Semiconductor, but also for the future of the economy, Korea should overcome this pincer operation by its rivals.
Strengthening market share through constant investment is the sole shortcut to victory. Lessons can be learned from the failures of Japanese and U.S. companies, which had been afraid of taking risks and lazy in investing. It is fortunate that Samsung Electronics recently announced that it would expand its portion of NAND flash chips beginning next year and spend 3.3 trillion won on its Giheung and Hwaseong semiconductor complex in order to eventually overtake Intel by 2010.
Samsung Electronics and Hynix underwent difficulties during the Asian financial crisis in the late 1990s, when the prospect for their recovery was bleak. However, they rose again with vigorous leadership, prompt decision-making and integrated business resources. Grasping the market flow in advance and adopting drastic investment plans have led to success. However, the two companies should not stay complacent with their present dominance. They should rearm themselves and enter the battle again. The road to becoming the top company in the world is never smooth. The companies should always keep in mind that their future depends on how much they prepare.