According to the Wall Street Journal, the continued popularity of networked devices and big data has greatly benefited chip makers. As an obscure science and technology industry, the chip industry has grown to 352 billion US dollars in annual scale. Semiconductors bring brains to driverless cars, help servers to process data, and determine the speed with which smart phones process text messages and stream media. This leaves the unknown chip industry at the forefront of the current battle in Silicon Valley. Price increased The widespread adoption of networked devices and big data has brought new forces to Samsung, Intel, Qualcomm, Toshiba and other chip makers. The semiconductor industry has also seen unprecedented prosperity. The rise in demand has pushed up the price of chips, and it has also brought advantages to companies that can get a lot of inventory. According to DRAMeXchange, which tracks sales and prices, from July of last year to March of this year, the prices of two major types of memory chips (NAND for content storage and DRAM that can increase the speed of multitasking for devices) have risen. 27% and 80%. Samsung, which dominated both markets, benefited: The chip business accounted for nearly 64% of its operating profit in the first quarter of 2017, much higher than the same period of three years ago. Samsung’s stock price has risen by about 30% in the past six months and has hit a record high in recent weeks. Other memory chip manufacturers such as Hynix have also recorded significant profit growth recently, and the share prices of semiconductor manufacturing equipment suppliers such as Applied Materials and Lam Research have skyrocketed. Semiconductors appear in almost all electronic devices and home appliances. According to Gartner, in 2014, from baby monitors to thermostats, the total number of global connected devices reached 3.8 billion, and this year is expected to increase to 8.4 billion, and by 2020 it will reach 20.4 billion. Analysts estimate that the chip industry's revenue will double in the next decade, and may even double. Avril Wu, director of research at DRAMeXchange, points out, "This is only the beginning." The scale is nearly doubled from 2003 According to market research firm IHS Markit, the annual revenue of the chip industry has almost doubled since 2003 to $ 352 billion - more than twice the size of the US automobile manufacturing industry, but also exceeds the size of the US fast food industry . The ten years of industry consolidation, coupled with the high cost of new chip development, has greatly increased the barriers to market entry, and a small number of traditional large companies have thus been able to increase their profit levels. According to IHS Markit, Intel is the world’s largest chip maker and achieved revenue of US$55 billion in 2016, although this year it withdrew from the smartphone and tablet market due to its previous bets on wireless technology and losses. Ranked second and third in the chip industry are Samsung ($40.3 billion in revenue last year) and Qualcomm ($15.4 billion in revenue last year). TSMC and other foundries have not been included in the HIS semiconductor industry data. The chip industry includes three types of products that account for more than half of the total revenue. The logic chip brings brain and computing performance to the device. The product for the computer is priced at about $75, and the data server component used by Amazon or Facebook is priced at $4,000 or more. The other two are memory chips: NAND semiconductors determine the amount of data or content (such as music and photos) stored on a cell phone, laptop, or tablet. Their cost is about 25GB of storage space for 32GB. DRAM semiconductors determine the multitasking operating speed of the device; the standard chip cost is about $24. Samsung is growing stronger Samsung is growing stronger on the semiconductor battlefield. The world's largest smart phone maker is still the largest memory chip manufacturer, and it has become increasingly influential in the logic chip industry. Despite the loss of approximately US$5 billion due to the flagship Galaxy Note 7 recall last year, Samsung still recorded a 48% operating profit growth in the first quarter driven by record sales of semiconductors. Samsung Electronics’ executive vice president ES Jung, who heads the semiconductor R&D center, talked about the company’s new memory chips. The development of this product lasted 15 years and it helped boost the company’s profits. "Most competitors have given up, but we have never given up on research work," ES Jung said. Analysts expect that as more manufacturers can produce new high-end semiconductors that electronics manufacturers want, price increases for memory chips will slow down later this year. The reason why Samsung has made huge profits is because it can quickly expand production capacity to mass produce these relatively new chips. It is rare for equipment manufacturers to postpone the launch of new products because of shortage of chips, because they usually get inventory in advance about six months in advance. But they may have to make a compromise: use chips that take up more space or consume more energy. Mehdi Hosseini, a senior analyst of technology bank at Heiner International Group, an investment bank, points out that equipment manufacturers and technology companies sometimes purchase chips to build stocks, so they do not have to pay a premium when there is insufficient supply. As the chip prices rise, consumers may have to spend more money to purchase some equipment. According to Husseini, Apple’s new-generation iPhone price is expected to be $100 to $200 higher than last year’s iPhone 7, with memory chips contributing $50 to $60 for this increase. According to IHS Markit, Samsung's latest flagship smart phone, the Galaxy S8, has a memory chip cost about $10 higher than last year's previous model. Samsung's memory chip costs less than Apple, partly because the latter is expected to be equipped with a faster multi-tasking chip for the iPhone 8. The chip is similar to the chip used in last year's Galaxy S7 and this year's S8. Analysts said that the price of a new generation of iPhone will reach about 1,000 US dollars, while the standard version of the Galaxy S8 retail price of about 750 US dollars.