Taiwan-based foundry service providers have cut their prices for wafers built on mature node processes to reflect lower production costs, according to sources at IC design firm. The move is also aimed to encourage customers to build inventory, the sources said.

Some fabless IC firms tend to accept their foundry partners' low-price offerings in consideration of their long-term relationships, the sources indicated.

Chip inventories throughout the supply chain have actually been lowered to safe levels, the sources said. However, companies hold a wait-and-see attitude rather than restocking because of an uncertain business outlook, the sources pointed out.

Inventories climbed to excessive levels between the end of the second quarter and the beginning of the third quarter, due to a combination of negative macroeconomic factors such as weak consumer confidence in the US and the European crisis.

In other news, despite slow demand for mature process manufacturing, Taiwan Semiconductor Manufacturing Company (TSMC) continues to see orders heat up for advanced 28nm technology, according to sources at non Taiwan-based chip suppliers.