Intel has reportedly secured the majority of TSMC's 3nm production capacity

midian182

Posts: 7,284   +65
Staff member
Rumor mill: Intel has reportedly secured the majority of TSMC's 3nm process node capacity for next year and is said to be using the technology to create three new CPUs and a GPU. If true, such a move would put pressure on rivals AMD and Apple, who rely on the semiconductor giant for their chips.

According to Chinese publication UDN, production using the 3nm node is expected to start in the second quarter of next year, with mass production set to begin in the middle of 2022. Production capacity is expected to reach 4,000 wafers by May 2022, eventually reaching 10,000 wafers per month.

The report adds that Intel will tap TSMC's 18b Fab on the 3nm process node for four of its upcoming products: three CPUs and a GPU. In the case of the former, these are non-consumer processors, likely next-gen Xeon, designed for the server and data center markets.

Intel already has its own fabs and is allowing other companies, including Qualcomm and Amazon, to use its current and planned manufacturing capacity as part of its IDM 2.0 initiative. CEO Pat Gelsinger recently announced that the firm would be building a $120 billion mega-fab comparable to a "little city" in a yet to be decided US location. But it's likely that for the multi-tile-based design in Intel's upcoming chips, the company will utilize both its own fabs and TSMC's for production of different tiled dies.

Another advantage from Intel's point of view is that grabbing TSMC's 3nm production capacity could hamstring AMD's and Apple's plans for their own 3nm chips. AMD has already been struggling to secure enough 7nm chips from TSMC for its graphics cards and Ryzen CPUs—much of the production capacity on that node has been allocated to the PS5/XBSX consoles—and it won't want a repeat of the situation with 3nm.

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Tom Yum

Posts: 133   +297
I have worried that this could be a tactic Intel does to suppress AMD going forward. In a way it is similar to the massive discounts they gave to OEMs to remain Intel exclusive in the early 00's. Effectively, by using their financial clout they lock AMD out of marketshare gain until such time they're products are competitive again, and by doing so rob AMD of the revenue needed to continue funding R&D, resulting in them gradually dropping behind Intel. Once AMD starts struggling to keep up, gradually push margins back up and milk the market (ie the -Lake era).

Only this time it can be done completely legally, as there is nothing illegal about taking a margin hit (buying near-exclusivity on TSMC 3nm won't be cheap) to gain a competitive edge. But normally one's competitive edge doesn't directly inhibit a competitors ability to produce a product. In this case, AMD would be put in the position of either trying to outbid Intel for capacity (not sustainable due to disparity in financial resources between the two) or AMD loses access to the latest nodes. TSMC won't care as its more money in the bank for them. It is really important for the industry that viable competitors to TSMC (not Intel though given they are not a neutral foundry in the market) like Samsung can continue to keep up.
 

Geralt

Posts: 806   +1,217
I have worried that this could be a tactic Intel does to suppress AMD going forward. In a way it is similar to the massive discounts they gave to OEMs to remain Intel exclusive in the early 00's. Effectively, by using their financial clout they lock AMD out of marketshare gain until such time they're products are competitive again, and by doing so rob AMD of the revenue needed to continue funding R&D, resulting in them gradually dropping behind Intel. Once AMD starts struggling to keep up, gradually push margins back up and milk the market (ie the -Lake era).

Only this time it can be done completely legally, as there is nothing illegal about taking a margin hit (buying near-exclusivity on TSMC 3nm won't be cheap) to gain a competitive edge. But normally one's competitive edge doesn't directly inhibit a competitors ability to produce a product. In this case, AMD would be put in the position of either trying to outbid Intel for capacity (not sustainable due to disparity in financial resources between the two) or AMD loses access to the latest nodes. TSMC won't care as its more money in the bank for them. It is really important for the industry that viable competitors to TSMC (not Intel though given they are not a neutral foundry in the market) like Samsung can continue to keep up.
It is about ethics. Intel is not an ethical company.
 

HardReset

Posts: 1,314   +983
@midian182: This is old news. TSMC have exactly two customers for 3nm first phase: Apple and Intel. Which of these two will grab larger amount of that first phase capacity 🤔

Production capacity is expected to reach 4,000 wafers by May 2022, eventually reaching 10,000 wafers per month.
Eventually 3nm capacity will be around 100 000 wafers per month.

Intel will use Over 50K wafer starts per month for just 3 CPU's and one GPU 🤦‍♂️"(y) (Y)"

Good example of wrongly understood "news" that appears on many sites...
 

HardReset

Posts: 1,314   +983
I have worried that this could be a tactic Intel does to suppress AMD going forward. In a way it is similar to the massive discounts they gave to OEMs to remain Intel exclusive in the early 00's. Effectively, by using their financial clout they lock AMD out of marketshare gain until such time they're products are competitive again, and by doing so rob AMD of the revenue needed to continue funding R&D, resulting in them gradually dropping behind Intel. Once AMD starts struggling to keep up, gradually push margins back up and milk the market (ie the -Lake era).

Only this time it can be done completely legally, as there is nothing illegal about taking a margin hit (buying near-exclusivity onTSMC 3nm won't be cheap) to gain a competitive edge. But normally one's competitive edge doesn't directly inhibit a competitors ability to produce a product. In this case, AMD would be put in the position of either trying to outbid Intel for capacity (not sustainable due to disparity in financial resources between the two) or AMD loses access to the latest nodes. TSMC won't care as its more money in the bank for them. It is really important for the industry that viable competitors to TSMC (not Intel though given they are not a neutral foundry in the market) like Samsungcan continue to keep up.
Like I said above, this is fake news. TSMC just wants another company to cover costs for ramp up so it can be done quickly. Other one is Apple.

Someone just "understood" that Intel takes majority of ramp up capacity = Intel takes majority of final capacity :joy:
 

Dimitriid

Posts: 1,331   +2,600
How can they possibly outbid Apple? This is *exactly* what this stupid artificial shortage is all about: a price war between all these competitors. What's even more damning for my price fixing arguments is that intel themselves are also a fab provider, so this is totally and transparently PRICE FIXING: they just want to use the rumors or the deal as leverage against Apple and AMD so they end up paying a hell of a lot more.

Tech industry will suffer through some reaaaally heavy handed litigation and government investigations and subsequent demands in the years to come, I hope most of you are ready to consider my advice: downsize. Eliminate the need for you to keep getting better and better CPUs and GPUs and give smaller gaming titles and more efficient OS and software tools like Linux a chance so they can battle it out and we all can keep doing what we like doing without caring.
 

RedBear

Posts: 27   +23
It is really important for the industry that viable competitors to TSMC (not Intel though given they are not a neutral foundry in the market) like Samsung can continue to keep up.
Samsung isn't entirely neutral either, reportedly their early 3nm process might be available only to Samsung' LSI division in 2022. And they might become even less neutral if Windows on ARM will stop being bad at some point, there are rumours about Samsung trying to enter the PC market with their new Exynos SOCs.
 

HardReset

Posts: 1,314   +983
How can they possibly outbid Apple? This is *exactly* what this stupid artificial shortage is all about: a price war between all these competitors. What's even more damning for my price fixing arguments is that intel themselves are also a fab provider, so this is totally and transparently PRICE FIXING: they just want to use the rumors or the deal as leverage against Apple and AMD so they end up paying a hell of a lot more.
Pretty impressive, everything wrong there "👍"

Let me make this "news" clear. TSMC initial 3nm mass production is around 10% of eventual 3nm mass production. This first 10% production has very likely bad yields that means cost per chip is very high. Apple and Intel are only companies that want to pay that price. TSMC would gladly take even more customers for first phase to get faster ramp up. From this first 10nm production Intel takes majority because Intel has much larger chips that Apple has.

Nothing to see here.
 

Watzupken

Posts: 383   +352
I have worried that this could be a tactic Intel does to suppress AMD going forward. In a way it is similar to the massive discounts they gave to OEMs to remain Intel exclusive in the early 00's. Effectively, by using their financial clout they lock AMD out of marketshare gain until such time they're products are competitive again, and by doing so rob AMD of the revenue needed to continue funding R&D, resulting in them gradually dropping behind Intel. Once AMD starts struggling to keep up, gradually push margins back up and milk the market (ie the -Lake era).

Only this time it can be done completely legally, as there is nothing illegal about taking a margin hit (buying near-exclusivity on TSMC 3nm won't be cheap) to gain a competitive edge. But normally one's competitive edge doesn't directly inhibit a competitors ability to produce a product. In this case, AMD would be put in the position of either trying to outbid Intel for capacity (not sustainable due to disparity in financial resources between the two) or AMD loses access to the latest nodes. TSMC won't care as its more money in the bank for them. It is really important for the industry that viable competitors to TSMC (not Intel though given they are not a neutral foundry in the market) like Samsung can continue to keep up.
It could be a tactic to slow AMD down, but is a very costly one for Intel. So far, only the likes of Apple have the money to chase after cutting edge nodes since they sell their products to consumers at a steep premium generally. AMD’s tactic so far seems to be going for the next best mode, ie, when Apple is using 5nm, AMD sticks to 7nm. This way they avoid paying the cutting edge premium. Interesting to see how this pans out.
 

HardReset

Posts: 1,314   +983
But I would say, it is a nice problem to have that all of your products are sold instead of sitting in a warehouse.
Well, Sony and MS APUs aren't AMDs products after all. Basically Sony and MS decide where to make chips and due to x86 license issues AMD is one that officially order them. That means Sony and MS chips were not affected by WSA.

But AMD would rather use TSMC's limited capacity for their own products rather than someone else's. But also yes, outselling products is still better than building huge storage... Interesting times.
 

NeoMorpheus

Posts: 883   +1,679
Well, Sony and MS APUs aren't AMDs products after all. Basically Sony and MS decide where to make chips and due to x86 license issues AMD is one that officially order them. That means Sony and MS chips were not affected by WSA.

But AMD would rather use TSMC's limited capacity for their own products rather than someone else's. But also yes, outselling products is still better than building huge storage... Interesting times.
Even if they are getting a penny per SOC, its money coming in.

Also, I guess that not needing warehouses, might be one less expense at the moment.

These are indeed interesting times.
 

Shadowboxer

Posts: 1,861   +1,464
There is absolutely nothing unethical about this at all. TSMC is a business who sell to the highest bidder. Intel have clearly offered to pay them more than AMD did. So for the neutral this is just normal news. However I’ve noticed the usual AMD fans in the comments here panicking, claiming the usual anti consumer bs. (The last time there was a class action lawsuit against either of these companies it was against AMD for miss selling on the core counts of its FX chips).

AMD of course did have its own foundries but it sold them off. So they rely on TSMC. If that third party sells its space to another company well that’s on AMD.

Also guys the bum licking of Dr Lisa Su is incredibly cringeworthy..
 

DonquixoteIII

Posts: 99   +58
It is about ethics. Intel is not an ethical company.

Money is not ethical, nor moral. It is money. Shareholders want their 90 day money. Shareholders are not ethical, nor moral. They just want their money. Intel is obligated to give it to them. Do not ever talk about ethics in relation to money, corporations or shareholders.

Wish it weren't so, but that is the way it is.
 

Markoni35

Posts: 1,318   +534
The solution is obvious: Make competition to TSMC. It's stupid that one company is controlling most of the world production of top chips. There has to be competition.