With TSMC and Samsung Fighting for Global Processor Dominance, TSMC Brakes Ground for 3nm Plant & Reveals Future Plans
As 2018 began, Taiwan Semiconductor Manufacturing Company known as TSMC broke ground for their 5nm processor plant that will be making chips for Apple's iPhone 12 in 2020. One year later it was reported that Apple was already Engaged with TSMC's 5nm Processor Team to Prepare for a 5nm iPhone in 2020.
Today we're learning that TSMC is accelerating its investment in micro-fabrication processes to widen its gap with Samsung Electronics by breaking ground on their next-gen 3-nanometer (nm) foundry plant. Its total investment will touch the level of US$20 billion. The new plant is expected to start volume production in 2022 at the earliest, according to sources.
The 3-nm process is expected to churn out ultra-precision semiconductors mainly used in cloud computing, artificial intelligence (AI), and 5G mobile communications.
TSMC’s major customers are expected to be Apple, Huawei and Nvidia among others. TSMC is increasing the proportion of micro-fabrication processes, including a 7-nm process, which was applied to roll out products for Apple's iPhones recently.
In addition, the company is accelerating the application of micro-fabrication processes in preparation for a sharp increase in demand for ultra-precision semiconductors. The Taiwanese foundry giant plans to increase production of 5-nm products next year.
Furthermore, TSMC let it be known that it is planning to start volume production of 2-nm chips starting 2024.
TSMC recently announced that it will raise its facility investment goal by up to 50 percent to US$14 billion to US$15 billion this year. It is a response to the rapid growth in demand for 7-nano-or 5-nano ultra-precision semiconductors stemming from the expansion of the 5G ecosystem.
Samsung Electronics is also focusing on securing micro-fabrication technology in line with recent changes in the semiconductor market. Samsung aims to mass-produce 3-nm products in 2021, one year ahead of TSMC. However, the company is not moving swiftly compared to TSMC, which has announced a large-scale facility investment plan in 3-nm processes and started the construction of a new plant.
Unlike TSMC, which has already announced a plan for a 2-nm process, Samsung Electronics has yet to disclose a specific plan for a 2-nm process.
Why is TSMC racing so hard against Samsung who is far behind them at present? We answered that in part back in April in a report titled "Samsung is #1 in Memory Chips today and over the Next Decade they Plan to Beat TSMC & Qualcomm in High-End Processors." The President of South Korea made a public pledge that they would work to make South Korea the global leader in high-end processors beyond memory chips as they are today.
South Korea's government making their intentions known too early only sparked TSMC to respond quickly with break ground for a 3nm plant and reveal their 2nm roadmap known in general. All of which is great news for Apple. It will mean better processors, better battery life, more advanced features for existing and future Apple products like a headset and beyond.