Foundries and outsourced assembly and test (OSAT) houses have traditionally had distinct lanes, but the lines are blurring as OSATs acquire select foundry capabilities and foundries return some of the jobs they have taken from OSATs.

“We’re at this bridging point where the IDMs and the foundries are doing more of what OSATs can do, and the OSATs are also trying to get much closer to what the foundry does at the back end,” said Raghu Nayak, head of sales at Zeiss.

OSATs will never compete with foundries on advanced nodes and front-end wafer fabrication. But for backend activities, where dimensions aren’t as demanding, OSATs are acquiring capabilities that replicate what foundries can do. The biggest areas of overlap are 2.5D integration and panel assembly, with hybrid bonding likely to move there as well.

The change affects equipment and materials. “We are seeing the migration of lithography-related materials and processes from traditional wafer fabs into advanced packaging environments,” said Poupak Khodabandeh, chief business officer at Brewer Science. “As advanced packaging increasingly relies on fine-pitch redistribution layers (RDLs), OSATs and packaging organizations are using materials and process flows that historically would have been associated with wafer fabrication.”

“The industry has traditionally operated in silos across equipment, front-end fabrication, design, packaging, and test,” said Jack Berg, vice president of business development at Silvaco .

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