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Intel Hardware

Intel Recruits TSMC To Produce Atom CPUs 109

arcticstoat writes "Intel has surprised the industry by announcing a memorandum of understanding (MOU) with Taiwanese silicon chip maker TSMC to manufacture Atom CPUs. Although TSMC is already employed by AMD, Nvidia and VIA to make chips, it's not often you see Intel requiring the services of a third fabrication party. Under the MOU, Intel agrees to port its Atom CPU technology to TSMC, which includes Intel's processes, intellectual properties, libraries and design flows relating to the processor. This will effectively allow other customers of TSMC to easily build Atom-based products similarly to how they might use an ARM processor in their own designs. However, Intel says that it will still pick the specific market segments and products that TSMC will go after, which will include system-on-chip products, as well as netbooks, nettops and embedded platforms."
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Intel Recruits TSMC To Produce Atom CPUs

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  • Re:Nice Intel (Score:5, Interesting)

    by Chabo ( 880571 ) on Monday March 02, 2009 @07:39PM (#27046169) Homepage Journal

    Disclaimer: I work for Intel, but I'm not involved in manufacturing, so I only know what the public knows.

    From what I understand, pretty much every employee at the fabs being closed are being offered jobs at other fabs, and pretty much the only way that anyone's losing their job is if they can't move, or refuse to do so.

    Unless I'm mistaken, the closing of the fabs is merely a consolidation of resources, as well as an elimination of older process technologies, without a reduction in workforce.

  • Re:Nice Intel (Score:5, Interesting)

    by Yarhj ( 1305397 ) on Monday March 02, 2009 @07:46PM (#27046249)

    Actually, Intel spread the layoffs around, closing two test/assembly fabs in the Phillippines and Malaysia as well as a fab in Oregon and one in Santa Clara. All of these fabs were running 200mm wafers at older tech nodes (120nm and up, I believe).

    These closings would likely have come along in the due course of time, but the economy hastened things a bit. As to moving the fabrication of Atoms over to TSMC, it's a pretty logical move. Atom is a low-margin part, so Intel probably doesn't want to clog up its most advanced fabs with Atom wafer starts, when it can ride out the recession and hope for a resurgence in demand for high-performance, high-margin parts.

    That said, it's quite interesting that Intel is contracting with TSMC, because Intel's real market advantage has always been its fabrication prowess. I'm sure there are about a thousand pages of legalese restricting TSMC's rights to the high-k process (or any other tricks Intel has up their sleeve)

  • Long time coming (Score:2, Interesting)

    by Anonymous Coward on Monday March 02, 2009 @07:53PM (#27046315)

    I worked at Intel in a temp position last year, and this is nothing new. It was the dirty secret around the fab that Intel was using TSMC for certain runs, and it was only a matter of time before something large scale was announced. Fabs are not profitable without huge volume and both AMD and Intel are feeling the pressure.

  • by SpazmodeusG ( 1334705 ) on Monday March 02, 2009 @07:54PM (#27046327)
    Remember how IBMs PC-BIOS was reverse engineered and there wasn't anything IBM could do about it because the reverse engineering was done legitimately? []

    If Intel licenses its 32nm manufacturing process to TSMC it will make it harder for TSMC to create a new 32nm for creating chips for other manufacturers. Intel could claim TSMC used information given to them under a license agreement. It will be hard for TSMC to claim any new 32nm process wasn't created using information covered under that license.
  • Re:Nice Intel (Score:2, Interesting)

    by WS Tu ( 1045270 ) on Monday March 02, 2009 @08:03PM (#27046399)
    hey, at first, TSMC is a company in Taiwan. So as their main factory. And the labor cost is not really a big issue in semiconductor fab. Yield and other issues are more important to them. Intel made good margin on Atom ( Some people think intel is not good at make low power product. Some others think intel want TSMC to help the industry adopt Atom as part of their design.
  • by John Jamieson ( 890438 ) on Monday March 02, 2009 @08:05PM (#27046423)

    Intel does not need any fabbing capacity. What they do like is to mess with AMD partners.

    Let the games begin.

  • by frieko ( 855745 ) on Monday March 02, 2009 @08:07PM (#27046443)
    "The TSMC 45nm process combines the most advanced 193nm immersion photolithography, performance-enhancing silicon strains, and extreme low-k (ELK) inter-metal dielectric material to bring both performance and reliability to advanced technology designs."

    sauce []
  • Re:Nice Intel (Score:5, Interesting)

    by mabhatter654 ( 561290 ) on Monday March 02, 2009 @08:42PM (#27046717)

    I think they're just buying up the competition's workspace. After all TMSC is going to KNOW the check from Intel will cash, no matter what... and like Apple buying up Samsung flash ram, this makes prices higher for everybody else...and gives Intel CONTROL over one of the few companies that could make VIA's nano or Nvidia's ION. It's also, lower cost, older process equipment closer to China where they want these chips to be sold.

    I think you're also looking at the patent front, that Intel will fill the place up with their patented processes and TMSC won't be able to fill orders for VIA/AMD/Nvidia without stepping on some Intel patents.. or have to run those jobs in the backroom on old, unproductive, equipment.

  • by Ritz_Just_Ritz ( 883997 ) on Monday March 02, 2009 @09:05PM (#27046895)

    This is Intel saying they MIGHT outsource some manufacturing to TSMC for the Atom SOC applications. Intel has their own pretty substantial fab facilities. However, they're out on this netbook limb now. If it takes off, they're going to need extra manufacturing to meet demand. If it doesn't take off, they don't want to have a lot of capital tied up in extra fab facilities.

    I'm not a big Intel fan, but this is a fairly astute move on their part and buys them some flexibility in the medium-term depending on where netbook sales go.


  • Re:Nice Intel (Score:4, Interesting)

    by Hal_Porter ( 817932 ) on Monday March 02, 2009 @11:45PM (#27047741)

    Taiwan != China. Actually TSMC has been making chipsets for the Atom for some time, so I'm told. The Atom itself was made by Intel, on its latest process. TSMC lags behing Intel in process technology, but apparently that no longer matters for Atom. As anantech put it []
    The other thing to keep in mind is that Moorestown, the first Atom SoC, will be built at 45nm while the first 32nm CPUs are shipping from Intel. Another way of putting it is that Atom processors don't appear to need the latest manufacturing process, just one that's mature and good enough. TSMC is transitioning to 40nm now, so Atom SoCs that are made there won't really be that far behind those made at Intel, if at all.

    Actually if you read the rest of the article, there's a deeper reason for this. Historically chips for something like a cellphone take an ARM core and some custom peripherals, integrate them onto a chip and then fab them at somewhere like TSMC. Intel has never done this - they selll chips not IP. In fact one of the reasons the XBox360 moved to PPC was because Intel would not license their core as IP to be integrated into an ASIC. Intel Atoms on a TSMC process would be cheaper, but the real benefit would be (as Anandtech put it)

    The Lincroft and Langwell blocks are done by Intel. The PMIC and Evans Peak blocks are partly Intel and partly 3rd party IP that are intermixed. Evans Peak in particular looks like it's going to be home to all sorts of IP depending on the application. A smart phone Atom SoC design might integrate a 3G modem here, while an iPod would opt for something else.

    This makes sense if Atom is supposed to be competing with ARM. Maybe in the future they will sell Atoms as a hard macro like Arm do.

  • by Anonymous Coward on Monday March 02, 2009 @11:47PM (#27047747)

    TSMC does have a fab in the US (Washington State) []. They also have fabs in China.

    TSMC's labor costs are almost nothing. They are a capital intensive company with almost all the money they spend going into equipment, fabs, and R&D (including really fancy scheduling algorithms).

    For a variety of reasons, TSMC fabs in Taiwan are the most efficient and have the highest yields. If the US fabs could be as efficient, TSMC wouldn't think twice about building many more there. Again, labor costs are nothing compared to their capital costs, and if US workers could somehow make the US fabs get higher yields, it would be well worth compensating them for it.

    Sort of more tangentially, a hidden advantage for Taiwan is the clustering effect of the semiconductor industry in Taiwan. With a cluster, information moves around much more rapidly, it's easy to find good workers, you get a lot of very specialized, very good companies with top service that dominate their particular sector; it's all the same advantages that Silicon Valley has had in the IT industry (and possibly will also have with biotech and green tech).

    Hsinchu is the big semiconductor cluster with everything from wafers to fabs to design houses. There are other clusters in other parts of the island as well (precision tools, high end bicycles, solar panels, LCD panels, super yachts, etc).

  • Re:Nice Intel (Score:2, Interesting)

    by drhank1980 ( 1225872 ) on Tuesday March 03, 2009 @01:01AM (#27048089)

    As someone who works in semiconductors in the USA I would answer your question with its a little bit of all of these.

    As for labor in a modern factory there are very few line operators but the TSMC equivenent of my Engineering position gets paid a whole lot less than I do and if your process is complex enough you will still need process and equipment engineers as stuff will always break.

    Marerial costs can come down a little bit, especially if your location has really cheap electricity and reasonably clean water nearby.

    Environmental compliance is a pretty big item as well. Fabs are basically giant toxic waste dumps the less you need to clean up the acid waste before it goes down the sewer the cheaper it is.

    IP is possibly the scariest part for Intel, but TSMC was already offering 45nm products so the node that the Atom is built on is already pretty common in foundries, also TSMC has a very good reputation for building partnerships.

    I think you last point is the possibly the biggest reason for Intel's move. An empty fab is a cash sink and TSMC has seen their orders plummit as most of their customers who have their own fabs (that they intend to keep) are canceling their orders with them to keep their own fabs more full even if it costs more to make a wafer in house. When a state of the art Litho Tool cost 50+ Million for one of them, if you bought them you need to keep them running to have a reasonable ROI. And if you close your fab this 50 Million will not fetch anywhere near 5 Million on the open market.

    I have heard that even as early as November 08 TSMC was offering to make us wafers for 60% of what we were paying at the time I can only imagine that it has come down even from there.

  • by PapayaSF ( 721268 ) on Tuesday March 03, 2009 @02:04AM (#27048375) Journal

    Cutting corporate taxes, which are already lower compared to most other countries

    Where do you get that idea? The average combined federal and state corporate tax rate in the U.S. is 39.3 percent, second among OECD countries to Japan's combined rate of 39.5 percent [].

Make it myself? But I'm a physical organic chemist!