Semiconductor industry and market
Which business model keeps fab investment down by making some products in its own fabs while outsourcing leading-edge products and the like to foundries?
- AFabless
- BFab-lite
- COSAT
Show answer and explanation
Answer: B. Fab-lite
In the fab-lite model, products on mature processes or where the company has strengths are made in its own fabs, while products on leading-edge processes requiring huge investment are outsourced to foundries. It sits between fabless, which owns no fabs, and IDM, which does everything in-house, retaining manufacturing know-how while limiting the investment burden.
- A. Fabless means owning no manufacturing fabs.
- B. Correct. It is a model that keeps fabs light.
- C. An OSAT is a company that provides back-end services under contract.