Banking on the windmill strategy

Shin: In the image sensor sector, we have to create new value.

SiliconFile Technologies Inc. (SFT) is a leading manufacturer of CMOS image sensors (CIS) for cellphones. The company has ranked fifth in the global market in terms of image sensor production volume since it was established in 2002, even though it is a small fabless company with only 80 employees. SFT is the first Korean company to contract and export its 2Mpixel image sensors to Japan. In China, the company holds about 60 percent market share in the 2Mpixel CMOS image sensor market.

SFT CEO Shin Baek-Kyu (Alex Shin) has used a "windmill strategy" to steer the company to success. The key point of this strategy is to maximize current benefits while simultaneously preparing for the future. A windmill is composed of a post with sails, and a strut to support the post. Wind causes the sails to spin.

In SFT's strategy, the post stands for the current image sensor area. Shin has stressed that one way of attaining sales goals is to have the technology to minimize chip sizes down to 10-70 percent of competitors' chips.

The sails located at the top of the windmill stand for the future: new business expansion based on a core product—the image sensor. Explained Shin, "In the image sensor sector, what we have to do is to create new value. The image sensor may be applied to bio chips, robots, environmental technologies and energy technologies." In pursuit of creating new value, SFT has created a bio chip that combines sensors with biometrics technology, and is developing ultra-thin solar batteries.

The strut that supports the post refers to SFT's strategic partnerships with strong foundry companies. According to Shin, the strategic partnership is a necessity for fabless companies and it is the reason that SFT has strengthened the strategic partnership with Dongbu HiTek.

Finally, the wind to drive the sails represents human and financial resources, which are essential to productivity.

'DRAMatization'
"2008 will be the year to restructure image sensor markets," noted Shin. "The companies without the DRAM-based process will be eliminated in the CIS markets." He expects that "DRAMization" will be the major topic of conversations in CIS markets in 2008 along with developing new business areas. Even though the DRAM industry sees 0.13?m and 0.9?m process as obsolete processes, the CIS industry continues to use these processes to reduce costs. "Fabless companies related with image sensors have to focus on reinforcing the partnership with foundry companies and continuing to meet customers' needs by developing new technology," concluded Shin.