14 DAY TRIAL // Although the Taiwanese company is in the middle of a serious 28nm manufacturing capacity expansion, Morris Chang, chairman and chief executive of TSMC, gave a rather somber outlook for the overall semiconductor industry. He said that the expected growth would range between 2% and 3%.
TSMC is investing heavily in capacity expansion to satisfy the increased demand and growth in the mobile sector. They’ve already lost a lot of important orders from the likes of Qualcomm and AMD that moved many of their 28nm designs over at GlobalFoundries, as we revealed here.
Morris Chang is also playing down Intel’s intention to start manufacturing chips for other IC design companies. The CEO said “Intel is dabbling in the foundry business. They are our indirect competitor.”
He means that Intel itself competes against TSMC’s customers, such as AMD, Nvidia, Qualcomm and others, but not against TSMC itself.
In his view, TSMC also has an advantage when compared with other FAB owners like Intel or Samsung, because the latter two are competing against their own customers.
TSMC will invest about $6 billion ramping up its 28nm process in several FABs. This is less than the 7 billion they’ve spent last year, but then again, this is only a capacity expansion move.
“It looks like 28nm will be a long-lived node,” said Dean Freeman, an analyst with Gartner Inc.
FD-SOI will offer a strong advantage over the current SOI technologies for the SOI integrators such as AMD and IBM, but TSMC is using mostly bulk 28 nm process and they’ve reached a good enough level of yields, so that they’re concentrating now on capacity expansion.
So, the next industry move will probably be towards FD-SOI when SOI players are involved and more refined finFETs and bulk process when TSMC is concerned, but these will all revolve around the 28 nm step.
Therefore if yields were bad, the most obvious move would have been troubleshooting the problems. Once we see TSMC is expanding their capacities, we understand that the 28 nm manufacturing process has matured at the Taiwanese FAB builder.
A small 2 to 3 percent growth of the overall semiconductor market rather means that some players will eat into the other player’s piece of the semiconductor pie. Our bet is on ARM and Intel is the likely loser.
Windows 8 and quad core 2.5 GHz ARM CPUs will most definitely make a serious dent in Intel’s mobile market.