Intel expanded its investment in Asia

Intel plans to build a $ 2.5 billion chip factory in China, and if so, this will be an important milestone for the chip giant.

Information is spreading very fast on the web that China's National Development and Reform Commission has just "turned on the green" for Intel to build a chip factory in Dalian city, northeast China.

If built, this will be Intel's fifth factory in China within the past decade. First, Intel built a flash memory chip factory in Pudong in 1997. In 2001, the second factory started. The third factory was inaugurated in 2004 in Chengdu while the fourth factory will be completed later this year.

The new factory in Dalien will focus on chipset production - an important part of the computer. The chipset provides the glue that binds the main processor to other systems such as memory chips and peripheral devices, such as keyboards and optical mice.

Not only is the world's largest microprocessor company, Intel also dominates the chipset manufacturing market when it accounts for more than half of the total $ 8 billion in revenue in 2006. The main competitors of Intel in the field chipser includes Nvidia, ATI and AMD.

In fact, Intel's technology to produce chipsets is a step slower than the microprocessor manufacturing technology, said Dean McCarron, director of Mercury Research. If at present, Intel microprocessors have been manufactured using 65-nanometer technology, so most new chipsets are released thanks to 90-nanometer technology.

" Usually Intel only makes chipsets at old factories, " McCarron said. Chipsets will be sold to PC makers such as Dell, HP, Gateway and Apple for an average price of 20-25 USD. And so Intel could benefit from very cheap labor costs in China.

Currently, Intel's main processor factories are still located in the US, Ireland and Israel. The Chinese government has tried to "pump" the domestic chip manufacturing industry, but so far, the results have not been very satisfactory.

This is in stark contrast to the situation in Taiwan, when the customized chip manufacturing industry is very popular. Big companies like Taiwan Semiconductor Manufacturing reached revenue of $ 8.1 billion, while United Microelectronics also pocketed $ 3 billion.

To compare, Semiconductor Manufacturing International, China 's largest chip maker, only achieved 1.7 billion dollars in revenue in 2005.

Trong Cam