According to the research findings, it can, therefore, be said that semiconductor firms regulated the whole production procedure, from design to manufacturing. Most chip developers are now delegating more and more manufacturing to the others in the industry. Foundry firms, whose main business is production, have currently come to fore, giving attractive outsourcing options. Moreover, to foundries, the ranks of increasingly chip testers and specialized designers are beginning to swell. Chip firms are emerging leaner and more effectual. Chip production now looks like a gourmet restaurant kitchen, where cooks queue to add the right spices to their meals. Threat of New Entrants: back in the days when semiconductor industry was just getting started, design engineers with great ideas would usually leave one firm to start up another. As the industry grew to maturity, nevertheless, putting up a chip fabrication firm required billions of dollars put into it. The price of the entry makes it impossible and painful for all except for the biggest players to put up with the state-of-art –operations. There was nothing surprising then, which already established player had an upper hand. Regardless there are projections that there could be some dynamics in the coming future. Semiconductor firms are merging or forming alliances to cost-share the costs of manufacturing. In the meantime, the appearances and triumphs of the fables chip developers indicate that it is just a matter of time before factory ownership last as an obstacle to entry. Power of suppliers: for big semiconductor firms, suppliers have very little power- most semiconductor firms have hundreds in the name of suppliers. This diffusion of jeopardy over most companies allows the chip giant to uphold the bargaining prowess of any supplier to a minimum. Nevertheless, with production growing huge and expensive, smaller chip developers are gradually becoming independent on a handful of big foundries. As the suppliers of production, skills and cutting-edge, the merchant foundries enjoy the privilege of considerable industry bargaining power. The biggest US-based foundry belongs to the great IBM that is also a top chip developer in its own right.
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