Taiwanese chip packaging and testing company Powertech Technology (PTI) once found itself in an awkward position: it had bought equipment for panel-level packaging, but the technology partnership it had been discussing had fallen through. It did not even have a factory ready to house the machines. Chairman DK Tsai recalled that discussions with Marvell co-founder Sehat Sutardja ended after Sutardja left Marvell. PTI eventually bought a former TSMC facility in Hsinchu and continued the work. It had already committed money to equipment and process development when the customer partnership it was counting on changed course.

Today, PTI’s Singapore collaboration with Broadcom gives the company, which built its business in memory packaging, a concrete opportunity to participate in manufacturing for optical communications. According to Tsai, the Singapore facility will use panel-level packaging for Broadcom’s silicon photonics chips, and Broadcom will take up its capacity. That gives PTI’s accumulated process capabilities a specific product direction and a source of demand.

On July 16, 2026, PTI announced plans to invest US$400 million in a Singapore joint venture with Broadcom Technologies, Inc. for advanced panel-level packaging. It would use its own funds, with investment proceeding according to construction and funding needs. On October 28, Taiwan’s Economic Daily News reported that the Investment Commission had approved the investment. The July announcement established the plan; the October approval marked an administrative step forward. The US$400 million figure refers to PTI’s investment. Company announcement; approval report.

Broadcom’s Product Requirements Meet PTI’s Interconnect Processes

PTI is an outsourced semiconductor assembly and test provider, or OSAT. These companies assemble chips into packages that can be used in systems and perform the associated testing. PTI has deep roots in memory. Moving into logic chips and optical communications brings a wider range of interconnect and integration requirements that vary with each product.

Tsai recalled that consolidation in the memory industry had left PTI with an increasingly concentrated customer base, prompting him to pursue logic chip business. In 2015, he visited Sutardja with a DRAM module made by PTI and invited him to see its production line. That helped a company known for memory packaging gain an opportunity to discuss a new packaging technology.

Broadcom already has a defined optical communications roadmap. In 2025, it announced its third generation of co-packaged optics (CPO) technology, attributing progress in the preceding generation to improvements in OSAT processes, thermal design, handling procedures, fiber routing and yield. CPO brings optical engines and switch chips into a more closely integrated packaging architecture. The optical engines convert between electrical and optical signals, while the complete product must also accommodate electrical interconnects, fiber connections and thermal management. Broadcom’s own account of the manufacturing work indicates the breadth of involvement required from packaging partners. Broadcom press release.

PTI’s published fan-out panel-level packaging (FOPLP) technology offers a view of the capabilities it could bring to the collaboration. Panel-level processing uses a rectangular carrier for packaging operations. A redistribution layer (RDL) uses fine wiring to reroute connections between chip contacts and external connections. PTI lists both turnkey FOPLP assembly and embedded-die fan-out RDL substrates among its offerings, alongside package design, thermal and mechanical simulation, process engineering and failure analysis. These capabilities allow it to work with customers on package design and manufacturing conditions. PTI technical information.

PTI PiFO package cross-section, showing a central embedded chip and upper and lower interconnect structures joined by vertical connections on either side.

PTI’s original PiFO structure diagram. The company describes this platform as using double-sided RDLs connected by copper pillars, with optical devices among its applications. The diagram illustrates one of PTI’s technical platforms; the specific structure to be used by the Singapore venture awaits product disclosure. Image credit: Powertech Technology, Panel Level Fan Out.

Viewed this way, Broadcom’s optical and switching products set the integration requirements, while PTI has an opportunity to apply its accumulated interconnect processes, material combinations and assembly capabilities to specific products. A package substrate provides support and electrical connections; completing a package also requires assembling, connecting and testing the chips and other components. The value of the collaboration will emerge through these actual deliverables. The further PTI’s work extends into product integration, the more closely its process development must track the customer’s product design.

The Broadcom partnership therefore has a specific distinction. In Tsai’s account of the Singapore facility, the customer provides both a silicon photonics product direction and demand for the capacity. For a technology that requires continued adjustment of materials and processes, this gives engineering work a set of product requirements to work against and gives expansion a demand basis. PTI’s customer relationship can consequently extend from individual manufacturing assignments into product development and capacity planning. How far it extends will depend on how the two companies execute the collaboration.

Panel Economics Depend on Engineering and Contracts

The attraction of panel-level packaging is that a rectangular processing area can accommodate package units more efficiently. As the carrier grows larger, however, materials and equipment must maintain acceptable processing conditions across a wider area before better area utilization can translate into a cost advantage.

Recalling the early development work, Tsai described one particularly difficult problem: different materials expand and contract by different amounts during heating and cooling, causing warpage and interconnect failures. The team initially had only a little over ten engineers, and some problems took months to diagnose. Such experience is difficult to acquire simply by buying equipment. Material selection, process sequences and failure analysis have to be connected through repeated fabrication runs to establish why a particular change works.

Optical communications adds more complex integration conditions. PTI’s panel-level process experience provides a starting point for addressing interconnect and materials problems; compatibility with optical components, fibers and thermal management must be validated through actual products. This gives the joint venture technical significance: the ability of the product company and the manufacturer to iterate against a shared set of performance, process and testing requirements will directly affect the pace of commercialization.

There is another layer to the economics. Tsai has said that the effect of yield on profitability depends on customer contracts. When supply timing matters greatly, the terms a customer will accept to secure capacity affect the costs borne by the manufacturer. Assessing this collaboration requires looking at process improvement alongside how capacity is used and priced. A single yield figure cannot answer both questions.

The most revealing developments will be the types of packaged products the Singapore venture actually delivers, the manufacturing steps it covers, and how customer validation progresses into consistent shipments. These details will clarify how deeply PTI’s role extends into product integration within Broadcom’s optical communications plans. For AI infrastructure companies in Europe and North America, they also bear on whether the optical communications supply chain can develop additional manufacturing capacity backed by the relevant process experience.

Sources

JULES INSIGHT

Technology and global industry, viewed from Taiwan.

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