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Summary form only given. As VLSI technology advances, it forces changes in the business organization of the industry. Traditional vertically integrated semiconductor manufacturers are concentrating less on manufacturing as foundries such as TSMC, UMC, and Chartered grow. These foundries supply capacity not only to fables houses but also to even large semiconductor manufacturers. As a result, these semiconductor houses are spending more time creating novel platforms for important applications. This puts them in competition with the systems houses that traditionally were their customers.