Hitting 3 nanometers to cost chipmaker TSMC at least US$20 billion

That's the price for continuing to cook Apple's cores

Taiwanese chip heavyweight TSMC has announced the location for its future 3 nm chip-making factory in late September and has now put a figure on how much that's going to cost: a cool $US20 billion.

Outgoing chairman Morrish Chang (last week, he announced he will retire in June 2018) revealed the figure in a chat with Bloomberg.

TSMC's main sources of income are mobile processors it supplies to Apple and fabless designer Qualcomm, both of which are keen on pushing AI out into consumers' hands. To keep them on board, the company has to stay ahead of the fabrication processes of rivals Intel and Samsung. Bloomberg notes it's a costly race, costing the company $10 billion a year.

Smaller geometries mean more transistors in a given space, and only a few of the industry's giants have pockets deep enough to work at the smallest sizes (Intel, STMicroelectronics, IBM, Samsung, Global Foundries, and TSMC among them).

Not all of those are seen as a threat to TSMC. Chang told DigiTimes last week he believes the company has “one to two tough rivals in advanced process technologies”, compared to a dozen in “the more mature 28 nm process” (the latter is becoming less important to TSMC, and currently on represents around 20 per cent of its revenues).

Concerns about Taiwan's infrastructure, particularly electricity supply, had led to speculation that the company might try and strike a deal with the Trump White House to build the fab in the USA.

However, Chinese news site UDN last week reported (in Chinese) the government had promised a new high-capacity transformer in TSMC's South Division Tainan Park, as well as fresh and recycled water supplies.

The government will also expand a nearby high-voltage substation as part of its deal to keep TSMC at home.

The company hopes to have the 3 nm process in operation by 2022. ®

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