Samsung opts to build $7Bn factory in China

The Korean need for national pride is about as strong as the Chinese need to be the world's factory. So what happens when the immovable object (Koreas desire to do everything itself) meets the irresistible force (China's need to do it for you)?  With the launch of Samsung's next chip factory now scheduled to happen in China, we're going to find out.

Many moons ago, ATI bought a Chinese graphics design company called XGI. When Shilov and co revealed this story, the logic behind the move was not clear. Chris Evenden (then ATI and now spinning for nVidia) declined to comment in the article, but the reality was that ATI hoped to gain an advantage over nVidia should China decide to implement a ‘protectionist policy' when it comes to technology design. In other words, if China decided at some point in the future that “Internally, it would prefer to buy chips that were designed by Chinese people and made by Chinese people”, then ATI would have an advantage.

So far, the kind of protectionism made popular by the USA does not seem to have happened in the Chinese chip business. But it might.

Samsung is keen to take a dominant role in the mobile phone/tablet markets and that means tapping into China first and India second. The decision to build Samsung's next FAB in China is driven by the need to be the ‘supplier of choice' to the Chinese people themselves.

In typically productive manner, Samsung is expecting to have the new plant producing chips by 2013.

KitGuru says: Eastern mentality results in logic like, ‘The best place for our next hard drive factory is inside the notebook assembly plant'. Reducing the shipping times and improving communications on ‘what is needed, where and when' is crucial if you want to win – and Samsung definitely wants to win. It's only got to beat Apple, right – so no biggie.

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