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IC Trays for a new generation of semiconductor products

Interview - June 22, 2023

Though not as technical as the component that it contains, IC trays still require a high-level of precision, and Shinon is making sure it meets these demands.


What do you believe to be your core strengths and competencies that set you apart from your regional competitors?

One of our biggest strengths is having production facilities in Japan, Taiwan, and Malaysia. This allows us to provide locally produced and locally procured products to the respective markets. Another strength is how accurately we can make our products.


What role do you believe Japan’s manufacturers will play in supporting the global semiconductor field going forward?

Both the Japanese government and private companies are actively taking steps to revive semiconductor production in Japan - this includes Shinon and other companies in this sector - so that we can continue to provide our products.

There are several interesting points, but let's start with the relationship between Taiwan and China. Today, semiconductor manufacturing heavily relies on Taiwan. The somewhat unstable nature of the relationship between the two countries is well-known worldwide. In terms of business continuity planning (BCP) and supply chain stability, it is expected that companies and governments will take action to have secondary or tertiary alternatives in their supply chains, considering it as a business opportunity. Companies such as Sony Semiconductor Solutions in Japan and TSMC are also seen as part of this movement. The objective appears to be establishing alternative supply chains that are not solely reliant on Taiwan.


During the pandemic, the semiconductor industry faced production challenges, and there was a significant chip shortage, affecting industries such as automobile manufacturing. As we transition to a post-COVID era and witness the resumption of normalcy, with events like SemiCon scheduled in California and Taiwan, firms are readjusting and re-establishing themselves. I'm interested to know how your business adapted during COVID and what post-COVID measures you are taking to ensure you adapt to emerging markets.

COVID-19 had two major impacts on our business. Firstly, it had a positive effect as the promotion of teleworking and remote conferences increased the demand for personal computers, which rely on semiconductors. This surge in demand for computers boosted the need for our products, keeping us busy during the pandemic.

Secondly, we were one of the early adopters of remote work systems in our company. From February to March 2020, when the COVID-19 outbreak hit Japan, we had about 25-26 staff who were indispensable, so we quickly shifted to teleworking and adjusted our commuting schedules to maintain productivity. However, those measures are no longer necessary, and we have returned to normal operations. Introducing this new work style allowed us to continue our business seamlessly.


You mentioned the importance of local partnerships and alliances, such as the one with Goldpar in Malaysia, which played a crucial role in sustaining and expanding your success during COVID-19. These alliances ensured local supply and production despite logistical disruptions. We would like to understand further how these partnerships fit into your business model. Do you have plans to seek new opportunities for international collaborations?

As you conducted your research, I'm sure you looked into our market share and business size. In terms of production capability, we have a much larger business size and market share, thanks to our partnerships and contracted companies such as Goldpar in Malaysia. We also have a Taiwanese company as a partner. Apart from our Taiwanese branch, we have invested in an independent Taiwanese company.

Looking ahead, I foresee growth in the demand for semiconductors, as they contribute to comfortable lifestyles. Many people worldwide have yet to attain such a lifestyle, and as their standards of living improve, the demand for semiconductors will increase. To cater to this new demand, Shinon needs to strengthen our partnerships and enhance the capabilities of our factories to meet the market's product requirements.


I'm curious to know more about your mold design and the manufacturing capability of your group structure, with SYTECS and FAST being two important members of the group. Can you tell us a little more about the role they play in this internal group structure, as well as some of the synergies you can create?

Firstly, we have a very structured group of companies. Shinon serves as the contact point with customers, handling sales, order reception, and designing according to customer specifications. Mold making is delegated to FAST. SYTECS uses molds for trade and mass production, as well as quality assurance.

This structured group of companies, with only 26 people in the office and a 10-person R&D center, allows us to classify and delegate work efficiently, ensuring collaboration within the group to meet the needs of the global semiconductor market.

While the tray may not be as mechanically or electronically sophisticated as the IC it contains, they often require a similar level of precision, as it must support both the transportation and protection of the package. One of your patented technologies is the TG (Three Guides), an asymmetrical structure that facilitates stackability and, most importantly, protects the package's content from any kind of damage. I was hoping you could give us a quick introduction to the TG patent technology and its main advantages.

We have developed several patents, including TG. I will omit detailed technical explanations. Instead, let me explain why these patents were developed.

It is thanks to our customers, who have faced various issues during semiconductor production. They approached us to find solutions for their challenges. For example, one issue we can solve using our patented technologies is the rotation of chips when handling the tray. All these patents are a response to the customers' needs.

I am curious to hear about your approach to developments in the semiconductor industry, particularly about miniaturization, as dictated by Moore's Law, as the number of transistors on a chip doubles every few years. IBM introduced a 2-nanometer node a couple of years ago, and TSMC is set to start production of 3-nanometer nodes for Apple next year. As smaller packages emerge, how do you develop your technologies to meet these demands? What challenges do you face?

With the miniaturization of IC chips and semiconductors, there has been a shift from macro-level to micro-level requirements. The IC chips are getting smaller and smaller, making previously unseen details visible to customers. For example, customers may notice fine particles on the tray's surface, depending on the materials used. As semiconductors become more sensitive, even small protrusions can impact their quality.

Customers have become more demanding regarding the quality of the trays. However, customers use the trays in clean rooms and expect us to produce them to the highest clean room standards. Despite our trays being made in conventional, non-clean room environments, our R&D team strives to improve the quality of the trays to meet the ever-growing demands for precision and cleanliness on a microscopic level.

Earlier, you mentioned the overreliance of the global semiconductor sector on Taiwan, and the impact of geopolitical tensions. The COVID-19 pandemic further highlighted this dependence and the need for increased globalization of the chip-making industry. I'm curious to know where you anticipate the growth of your products in the short to medium term. Are there any new markets that you are targeting to expand your presence?

Since you asked an excellent question, I would like to respond with a compelling story. The global semiconductor industry is no longer dominated solely by a few players like NVIDIA, Intel, and Micron in America. The landscape is changing, and there are now more emerging players.

It's very hard to predict the next center of semiconductor production. However, the United States, with companies like AMD, NVIDIA, Intel, and Micron, will continue to be leaders in the world. Regardless of where they choose to establish their production sites worldwide, we are committed to supplying them with enthusiasm and dedication by establishing local supply centers and factories.

Another strength of Shinon is our willingness to meet customer inquiries and demands. We don't say no to customers. Our patents, for example, have come about as a response to customer inquiries. We aim to fulfil the needs of our customers by having local production bases.

In Taiwan, our customers requested a local production base instead of relying on deliveries from Japan. In China, there is a Taiwanese manufacturer for our back-end processes who requested a factory in China. We happily accommodated these requests. We are flexible in meeting our customer's needs and are open to opening new factories around the world.

I believe Shinon is celebrating its 40th anniversary this year. If we were to return in 10 years for the 50th anniversary, is there a personal goal or ambition you would like to have achieved by that date?

Over the next 10 years, our target is not the commodity semiconductor market, but rather the non-commodity areas where there is less market fluctuation. While there will undoubtedly be a growing demand for semiconductors, there may be shifts from high-end to mid-end or even low-end segments.

These fluctuations are not conducive to business continuity, so we are focusing on non-commodity semiconductors, particularly those used in infrastructure communications, such as for 5G, and anticipating the emergence of 6G and 7G technologies. Additionally, the fields of AI and automation present stable and high-end demand for semiconductors. With these areas in mind, we aim to continuously grow our business.

Interview conducted by Neale Oghigian & Paul Mannion