Hardware

Intel Asks Samsung To Fabricate CPUs For PCs As It Struggles To Meet Demand?

Intel has reportedly commissioned Samsung to manufacture its next generation of performance CPUs for PCs. The chipmaker is apparently trying to address several issues with the decision of relying on Samsung, which has already secured several big orders from NVIDIA and Qualcomm. With the decision, Intel could also be trying to develop an alternate supplier to Taiwan’s TSMC, and distance itself from Huawei.

Intel, a global semiconductor company that combines semiconductor design and production, has reportedly approached Samsung and requested the latter to produce its CPUs meant primarily for the PC market. Samsung, which recently bagged a large number of customers such as NVIDIA and Qualcomm, has reportedly accepted the order. Interestingly, Samsung won’t be producing Intel CPUs on the 7nm fabrication process. Instead, it will produce 14nm CPUs.

The Korean tech giant has been aggressively marketing its manufacturing techniques and large production units in order to take on established market leaders like Taiwan’s TSMC. The company clearly wants to dominate the non-memory market, and Intel’s order would certainly help Samsung achieve its goal. Samsung’s silicon wafer production business bagged IBM’s server CPU supply contract last year. The business line recently secured NVIDIA’s next-generation Graphics Processing Unit (GPU), and even Qualcomm’s next-generation Application Processor (APU). If that’s not enough, even Apple Inc. and Hai Silicon (Huawei), the majority of semiconductor design companies that use state-of-the-art processes have become Samsung’s direct or indirect customers.

Intel has been facing an acute shortage of CPUs, especially on the promised new fabrication process. The company has been facing tough challenges in the process refinement area. Owing to such issues, Intel was eventually compelled to produce CPUs on the 14nm fabrication process instead of the much-hyped 10nm fabrication process. Intel has been successful in refining the process, but the delay in the process and the immediate challenge of deploying the relevant production lines was apparently too high a business risk. Intel’s risk assessment holds true especially owing to its immediate rival AMD’s rising capabilities.

AMD has been speed-tracking its development of 7nm CPUs. The company has even been working relentlessly to offer GPUs on the new fabrication process, thereby directly threatening Intel’s dominance. Interestingly, AMD has entrusted its 7nm CPUs and GPUs to TSMC. Intel appears justifiably concerned about the prospect that AMD will take up market share due to delays in its own micro-processing fabrication capabilities. A significant delay in ensuring the latest CPUs reach end-consumer could significantly alter the market share of the duo.

Samsung To Manufacture Intel’s 14nm PC CPU ‘Rocket Lake’?

According to industry experts, Samsung’s production facilities will mass-produce Intel’s products on the 14-nanometer fabrication process. It is not very likely that Samsung will manufacture Intel’s 14nm PC CPU ‘Rocket Lake’. These next-generation processors would most likely debut in 2021. It seems rather redundant to ask Samsung to manufacture CPUs that Intel is quite capable of fabricating itself. However, experts indicate Intel is testing the waters with Samsung. It is interesting to note that Intel chose Samsung over TSMC, the world’s leading processor maker.

It is quite likely that Intel is trying to stay clear of the trade ban that its home country slapped on Huawei. This is because TSMC also makes CPUs for Huawei. The Taiwanese company manufactures most of the products of Huawei’s semiconductor design subsidiary HiSilicon. Incidentally, the company recently reiterated its commitment to Huawei.TSMC indicated that it will continue to deal with Huawei despite the U.S. government’s sanctions. Hence it could be a rather risky decision for Intel to entrust its CPU production to TSMC at this juncture.

It is interesting to see Samsung making Intel’s CPUs on the 14nm fabrication process especially when rivals are actively exploring the smaller 7nm fabrication process. The decision might have to do with the challenges faced with the production techniques and technologies involved in shrinking the die size to such exceptionally small sizes. Although the rumor doesn’t hold much weight, for Samsung to manufacture something like this, there would have to be significant redesigns. Intel has only given out small performance chip production to other fabrications and it would hold true for Samsung’s deal as well.

The latest 7-nanometer fabrication process relies on Extreme Ultraviolet (EUV) exposure process. Needless to add, this is quite complicated and expensive. Meanwhile, the 14nm fabrication process is relatively faster, cheaper and more efficient. Moreover, it is an established and proven production process. This allows CPUs to be made with cost efficiency as one of the priorities. In real-world, this simply means Intel could offer CPUs at quite competitive prices. The competitive advantage between the 14nm and 7nm fabrication processes could be gradually minimized with better design and optimizing CPU architecture.


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