Scaling Silicon: The Birth of United Microelectronics Corporation

It’s one thing to create a proof of concept, but quite another to turn it into a successful business. This was the challenge that ITRI faced after licensing the seven-micron CMOS (Complementary Metal-Oxide-Semiconductor) technology from RCA.

As the first step towards achieving this objective, ITRI established a modest demonstration factory in 1977 to give the team of young engineers it had sent to RCA for training the opportunity to apply their newfound knowledge to the manufacturing of 3-inch wafers.

Within just six months, the factory achieved a yield rate of over 70%, surpassing even RCA’s facilities in the U.S. and exceeding the contractually stipulated 17%. Although the utilization of new equipment in the demonstration factory played a key role in achieving such an outstanding result, the success can also be attributed to the dedication and ingenuity of the engineering team who proved that that they not just mastered the science of semiconductor manufacturing but also the practical know-how required to deal with the subtle arts of optimizing the fabrication process in real-world conditions.

The demonstration factory initially concentrated on producing chips for digital watches, a low-risk strategy that allowed domestic consumer electronics manufacturers to quickly integrate these chips into products for export markets. This approach not only met immediate demand but also established a model for ITRI’s collaboration with private industry.

From 1976 to 1980, ITRI invested over US$120 million to further develop its capabilities, acquiring additional IC design and manufacturing technologies from abroad. This investment enabled the transition from seven-micron to a more sophisticated 3.5-micron process and increased the wafer size to six inches. To bolster its IC design capabilities, ITRI also adopted industry-standard software tools such as Spice II and CICAP.

With all these elements in place, ITRI was ready to take the bold step of spinning off part of the demonstration factory and related technology IP into a new company. On 22 May 1980, this venture was formally established as United Microelectronics Corporation (UMC) marking the beginning of the transition from government-led research and development to commercial semiconductor production.