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Is Intel outsourcing chip fabs?

Chips to Taiwan says rumour mill

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There are myriad reports that Intel is going to announce the outsourcing of its Atom processor chips and NAND flash chips to the Taiwanese Semiconductor Manufacturing Company.

The Taipei Times reports that TSMC will manufacture and supply Intel's Mobile Internet Device (MID) and Atom chips. It will be the first time that Intel has outsourced manufacturing of such a significant product.

The Atom CPU is Intel's small and low-power CPU for netbooks and other MID applications. It is a bright spot in Intel's chip line up as Netbooks are proving popular compared to desktops and notebooks in the recession. The Moorestown system-on-a-chip (SOC) variant is targetted at mobile phones and TSMC makes SOCs for TI and Qualcomm.

Intel is thought to be keen on growing its mobile phone chip business. Also, Intel boss Paul Otellini mentioned potential outsourcing of NAND chip manufacture last week.

TSMC is due to roll out 28nm chip processes in 2010, so it is unquestionably a first class foundry.

A press conference is to be held at Intel's Santa Clara briefing centre later today with Intel VP Sean Maloney and TSMC's global sales and marketing VP Jason Chen present.

Intel has rejigged its manufacturing in the wake of the recession, closing several plants, following a 90 per cent drop in its income for the final quarter of 2008.

We should have details of what Intel and TSMC are doing later today. ®

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