Analysis on Chinese Taipei's IC Production Structure and Market Competition Behavior-Influence on Market Competition Mechanisms by Business Merger Behavior
Chinese Taipei
Abstract：
1. Background and Motivation:
(1) The foundation has been laid in IC production by a prosperous
market-in global information, telecommunication and multimedia products-and
the government's long-term emphasis in high tech electronic production has
created unprecedented economic growth, leading us onto the international financial
stage. Even though being swept into the Asian financial storm along with many
other countries, Chinese Taipei has been walking on the safer side of the
economy. In addition, fierce market competition in IC production-regardless
of pure price competition or non-price competition, or technically strategic
alliance or merger and acquisition-has promoted an all-out war, attempting
a never-failing superiority in both the domestic and international market.
It is especially true with the trend in mergers and acquisitions due to the
recent global depression. Chinese Taipei's IC production or related production
have tried to cope with the impact by cases of merger and acquisition in accordance
with their mother companies (or affiliated companies) so that they may increase
their competitiveness.
(2) In view of the rapid growth and changes in Chinese Taipei's IC production,
the FTC, though it could investigate and analyze by real cases, may not have
a complete view of the operation of the competition mechanism. Therefore,
it is necessary for the FTC to explore the IC production and understand the
operation of the competition mechanism. In this way, the FTC may effectively
examine relative applications and instruct related businesses aiming at their
specific goals in order to take care of the IC production and the operation
of the competition mechanism. Hence, the research has been made with respect
to the above concerns.
2. Purpose
(1) To explore the history and development of the market operation
structure in Chinese Taipei's IC production as a whole and its core production.
(2) To explore the current situation of the competition environment in Chinese
Taipei's IC production as a whole.
(3) To explore the regulations in company mergers in Chinese Taipei's IC production
regarding Fair Trade Law (FTL).
(4) To analyze the inner effects of the mergers in IC-related businesses.
(5) To analyze the outside effects of mergers in IC-related businesses.
(6) To give concrete suggestions, in accordance with the Fair Trade Law, to
Chinese Taipei's IC production companies and to provide valuable references
to relative government authorities and IC production companies.
3. Subject and Scope
The subjects of the research focus on Chinese Taipei's IC production companies and their main core production market companies, while the scope of the research stays in the merger behavior of the competition behavior by the above companies.
4. Methodology
(1) Using Five Way analysis in production or business competition
in business management, and SWOT analysis to explore current and future developments
in market operation competition and its core production in Chinese Taipei
IC production as a whole.
(2) Using polls and questionnaires to collect relative market materials along
with cases approved by the FTC and various available relative numbers such
as financial proportions, researchers explore-by analyzing materials or individual
cases-the inner effects of merger behavior in IC-related business per se,
as well as the outside effects regarding the greater national financial interests
in proportion to limited competition.
5. Structure
This research first deals with the understanding of Chinese Taipei's IC production and its core market competitiveness. Then, by using the Five Way Analysis strategy by American business management scholar Professor Michael E. Porter, it explores company competition, buyer bargains, threats of the potential competitors, threats of the replacement products and seller bargains regarding Chinese Taipei's IC production and its core market competitiveness. Then, according to the SWOT analysis model, points out the strengths and weaknesses with respect to the superiority of the domestic environment in IC production and opportunities and threats of foreign competition to show specifically the current situation of market competition mechanisms. Moreover, with actual cases approved by the FTC concerning mergers, it analyzes, compares and contrasts according to the inner effects of the merger behavior in IC-related business per se, as well as the outside effects regarding the greater national financial interests in proportion to limited competition. Finally, it gives specific suggestions for the reference of FTC and IC-related business.
This research includes four chapters. Chapter One includes background, motivation, purpose, subject and scope, method and structure. Chapter Two deals with definition of the IC products, categorization in function, feature semi-conductor products, history of IC production in Chinese Taipei, characteristics in IC production, structure in core production market competition, as well as the assessment in competition in current environment. Chapter Three discusses the means of competition most frequently used by IC production companies-business merger behavior. Then, using relative market materials along with actual cases approved by the FTC and various available relative numbers such as financial proportions, researchers explore-by analyzing materials or individual cases-the inner effects of the merger behavior in IC-related business per se, as well as the outside effects regarding the greater national financial interests in proportion to limited competition. Finally, Chapter Four gives conclusions and specific suggestions.
6. Conclusions and Suggestions
(1) Conclusions
(i) Clarifying industry structures and developing good competition
mechanisms in the relative market of the production business.
(ii) Forming a competition mechanism and increasing our strength in international
competition.
(iii) Establishing, with analysis in individual cases, the effectiveness in
the merger behaviors of relative businesses of Chinese Taipei's IC production.
(2) Suggestions
(i) Continuing compiling materials in IC-related businesses
in order to be the base of further study.
(ii) The standard for merger may be categorized in an outline in accordance
with production differences so that it meets the needs of production and saves
unnecessary administrative costs of the business and the FTC.
(iii) The core production market constitutes a major part of IC production.
The production market in all levels is rather complete, providing cost -efficient
production. Every level of production exists in individual market and professional
production, reducing its cost due to mass economy. It is a characteristic
superiority in competitiveness. Thus it is a production that should be encouraged.
Being mainly competitive in foreign markets, the impact, obviously not greater
than the national economic interests, is quite limited regarding monopoly
due to company mergers. The FTC may simplify and expedite such merger applications.
Written by
Lin Yi-yu, Fu Ing, Shin Gin-tsun, Ho Pet-wen (Second Department)