Question

What is a key characteristic of fabless manufacturing in the semiconductor industry?

A. It involves companies that own and operate their own semiconductor fabrication plants.
B. It designs and markets semiconductors while outsourcing hardware's fabrication to a third-party foundry.
C. It focuses on in-house production of semiconductor materials and components.
D. It involves the integration of hardware and software in semiconductor production.

Which of the above statements is/are correct?

1. A and D
2. B only
3. B and C
4. A, C, and D

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Answer 1

Answer: (2) B only

Explanation:

Let's analyze each statement:

A. It involves companies that own and operate their own semiconductor fabrication plants.

• Incorrect. Fabless manufacturing companies do not own or operate semiconductor fabrication plants. Instead, they focus on design and marketing while outsourcing the actual fabrication process to specialized foundries.

B. It designs and markets semiconductors while outsourcing hardware's fabrication to a third-party foundry.

• Correct. This is the core characteristic of fabless manufacturing. Companies in this model design the semiconductor chips but rely on third-party foundries (like TSMC) to manufacture the physical chips.

C. It focuses on in-house production of semiconductor materials and components.

• Incorrect. Fabless companies do not focus on in-house production of semiconductor materials; they outsource the fabrication part to foundries.

D. It involves the integration of hardware and software in semiconductor production.

• Incorrect. While fabless companies may design hardware and could also work on related software, the term "fabless" specifically refers to the absence of in-house fabrication, not the integration of hardware and software.

Conclusion:

The correct statement is B, which accurately describes fabless manufacturing. Therefore, the correct answer is (2) B only.