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TSMC gears up for mass production of 3-nanometre chips for high-end computers and 5G phones


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TSMC gears up for mass production of 3-nanometre chips for high-end computers and 5G phones

 

  • iPhone maker Apple, 5G chip developer Qualcomm and graphics processing unit giant Nvidia will be among the first clients to use TSMC’s latest technology
  • TSMC reported record sales last year on robust demand for chips used in 5G smartphones, notebooks and high-performance computers

 

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Flags are are displayed outside TSMC headquarters in Hsinchu, Taiwan. Photo: Reuters

 

Taiwan Semiconductor Manufacturing Co (TSMC), the world’s biggest contract chip maker, is gearing up to roll out its newest chip production process, enabling the development of integrated circuits that speed up the performance of consumer electronics devices without sacrificing battery life.

 

The company will begin “risk production” of its 3-nanometre chipmaking process this year, an advance over the 5-nanometre process that was rolled out for mass production in 2020. The technology advance will deliver higher performance and longer battery life for 5G smartphones and other high-end electronics products.

 

Risk production means TSMC has developed basic production formulas and the process has passed reliability tests. The 3-nanometre process will enter volume production in 2022, a TSMC spokeswoman said, followed by the roll-out of a 2-nanometre process on an undisclosed schedule.

“We do believe that many customers and diverse applications can leverage the advanced technology to unleash innovation,” the spokeswoman said.

 
The 3-nm process allows 250 million transistors per square nanometre while 2-nm technology will enable more than 310 million transistors to be packed into the same area, said Tseng Guan-wei, an analyst with Taipei-based market research firm TrendForce. Higher transistor counts can lower power consumption while maintaining speed or boost performance with the same power usage, Tseng said.

 

TSMC’s advanced chip technology will be used in central processors, graphics processors and artificial intelligence (AI) accelerators – collectively known as high-performance computing – said Samuel Wang, California-based analyst with market research firm Gartner. Modem chips for 5G and future generation 6G wireless devices will also make use of TSMC’s 3-nanometre technology, Wang said.

 

iPhone maker Apple, 5G chip developer Qualcomm and graphics processing unit giant Nvidia will be among the first clients to use TSMC’s latest technology, said Mario Morales, a programme vice-president with market research firm IDC. Eventually, every smartphone with a Qualcomm chip will use it, he said.

 

The 2-nm architecture should slow leakage of electricity and reduce power consumption for consumer devices, said Liu Wen, industry analyst with the Market Intelligence & Consulting Institute in Taipei. “Consumers may notice some improvements in the battery life of devices,” Liu said.

 

TSMC’s 2-nm and 3-nm processes will give it a lead over major rival Samsung Electronics and keep it well ahead of Semiconductor Manufacturing International Corp (SMIC), according to analysts.

 

Shanghai-based SMIC will find it harder to catch up to TSMC now that it has been prohibited from buying US chip making technology after being slapped with US sanctions over alleged ties to the Chinese military – a charge that the company denies. SMIC is focusing on “stabilising” its management team before moving ahead, Morales said.

 

South Korean giant Samsung is trying to catch up with TSMC but will probably not achieve that within the next five years, Morales said. However, Samsung has set a goal of mass production of 3-nm chips in 2022, according to a Bloomberg report last November, citing a company senior executive who spoke at an invitation-only event in October.

 

TSMC reported record sales last year on robust demand for chips used in 5G smartphones, notebooks and high-performance computers. Its 2020 revenue rose 25.2 per cent year on year to NT$1.33 trillion (US$47 billion).

 

The advent of 2-nm mass production will raise TSMC’s foundry market share from 54 per cent last year to more than 56 per cent in 2023, Tseng predicted. As the market leader, TSMC will also “enjoy increased leverage in price negotiations” which in turn will keep its gross profit margin above 53 per cent.

 

However, volume production of chips below the 2-nanometre level will require the development of new materials and a purpose-build factory – both very costly investments – according to analysts.

TSMC is not shying away from the challenge, with “exploratory R&D work” being done in 2-nm in the area of memory and 3D transistors, according to information on the company website.

 

 

Source: TSMC gears up for mass production of 3-nanometre chips for high-end computers and 5G phones

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