Powerchip Semiconductor is building four new factories in Taiwan over the next six years to become one of the world's leading DRAM suppliers. The factories will cost between $2.2 billion to $3 billion each.

The company is betting more and more consumer electronics products will use DRAM, such as game machines and 3G mobile phones, and that, since many of its rivals are chasing the NAND Flash memory market, there will be more opportunities for DRAM makers in the future.

"We plan to build two new factories every three years for the next six years to meet demand," said Powerchip VP Eric Tang. Powerchip already has two plants operating in Taiwan. It built the first one just in time to catch a market upturn in 2003, and its second plant is already turning out around 25,000 wafers per month. Thousands of DRAM chips can be made on a single wafer.

Despite the lofty price tags on the new plants, they are important in driving down the cost of mass-produced chips. Companies estimate the factories slash the cost of chip production by about a third compared to older factories.

Earlier this week, one of Powerchip's main rivals in Taiwan, Inotera Memories, broke ground on its second 300-millimetre semiconductor factory, and expects to complete the project by the end of next year.

The global leader in DRAM production is South Korea's Samsung. The company has devoted ever more time and resources this year to producing NAND Flash memory chips, which are used in gadgets like MP3 players and digital cameras, because they're more profitable.