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Morris Chang, the founder of TSMC, predicts that Intel will continue to rely on TSMC for fabricating their advanced chips.
Intel is one of the very few companies in the semiconductor business with a dedicated fabrication lab. Unlike AMD, NVIDIA or Qualcomm, Intel fabricates their chips in-house without needing to rely on companies like TSMC. But here’s a catch.
For quite a while Intel has used the 14nm process to fabricate their CPUs. But the yield rate and scalability of the production for 7nm has seemingly not reached the viable limit for Intel in the past few years. As a result, Intel outsources the 7nm chips from TSMC.
Morris’ view on Intel Foundry and TSMC’s position
Chang talked a lot about the increasing geopolitical tensions and potential competition from other manufacturers leveraging global politics and international relations to their advantage. In the context of Intel, he mentions that the U.S. government is providing considerable support to the company, as reported by tom’sHARDWARE (via money.UDN.com).
However, he sees no threat for TSMC regarding Intel Foundry Services, a division of Intel for fabricating their chips. His reasoning behind this was that Intel will have to improve multiple aspects of its foundry operations such as the management and yield rate all while keeping the pricing competitive all at once.
And Intel has delayed the production of 7nm chips for multiple times now while continuing to outsource them from TSMC.
Chang also mentions that TSMC’s success has made possible a significantly higher production capacity, cost-effective manufacturing and building up a great R&D team. All these factors combined indicate the technological advantages TSMC have over its competitors.
Although, the increasing competition might pose a threat to TSMC
You might have heard about the Chinese giant Huawei‘s ability to manufacture 7nm chips despite the US sanctions preventing it from using US technologies. The root of the story lies with a Chinese semiconductor foundry company called SMIC. It somehow managed to successfully fabricate chips on 7nm for Huawei’s latest flagship, the Huawei Mate 60 Pro.
How SMIC managed to achieve this without using any U.S. technologies still remains kind of a mystery. However, China’s ability to independently manufacture SoCs is a clear implication that TSMC is not exempt from the competitive environment.
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