TSMC Raises Prices on AMD and Nvidia GPUs, Apple Partially to Blame - Report

TSMC has reportedly increased the prices of wafers manufactured using the 28nm fabrication process, a decision which could increase the production costs of next-generation GPUs developed by AMD and Nvidia as both companies rely on the advanced 28nm node for their chips.

According to unnamed sources cited by Charlie Demerjian of SemiAccurate, TSMC has taken this decision since they see a lot of demand for their 28nm process.

Most of the demand for the 28nm node reportedly comes from Apple, which has reached an agreement with the Taiwanese foundry to manufacture the system-on-a-chip (SoC for short) devices used inside the iPhone and iPad.

In addition to the high 28nm chips volumes required by Apple, TSMC is having troubles with achieving high yields on this manufacturing process, an issue which also leads to increased production prices for such devices.

Both Nvidia and AMD are relying on TSMC's 28nm fabrication process to develop their next-generation graphics cores, which are known under the code names of Kepler and Southern Islands, respectively.

Furthermore, reports suggest that Nvidia has also started to build a new series of refreshed notebook parts based on this advanced fabrication node.

At the end of July, TSMC representatives admitted the company is having troubles with the ramp up of 28nm parts, but noted that these aren't caused by quality issues, but rather by the weak economy and low demand for such products.

AMD is expected to launch its first Radeon HD 7000 graphics cards built using the 28nm node by the end of this year, while more parts will arrive in the first quarter of 2012.

As far as Nvidia is concerned, its first next-generation GPUs, based on the Kepler architecture, are expected to arrive at the beginning of next year.