GlobalFoundries drops push for next-gen 7nm semiconductor tech
California chip firm announces a halt to its development of 7-nanometer fabrication technology, leaving Apple partner TSMC and rival Samsung as the only remaining players in the space.
GlobalFoundries announced Monday that it is backing away from its ambitious plans to develop next-generation semiconductor technology, and will instead refocus its investment on existing technologies.
According to AnandTech, the shift means GlobalFoundries will drop five percent of its staff. The move also means the only remaining players in the next-generation semiconductor space are a pair of current and former Apple suppliers, TSMC and Samsung, respectively, and that the consumer electronics industry as a whole whole may very well find itself more dependent on those companies.
"Demand for semiconductors has never been higher, and clients are asking us to play an ever-increasing role in enabling tomorrow's technology innovations," GlobalFoundries CEO Tom Caulfield said in a statement released by the company. "The vast majority of today's fabless customers are looking to get more value out of each technology generation to leverage the substantial investments required to design into each technology node. Essentially, these nodes are transitioning to design platforms serving multiple waves of applications, giving each node greater longevity. This industry dynamic has resulted in fewer fabless clients designing into the outer limits of Moore's Law. We are shifting our resources and focus by doubling down on our investments in differentiated technologies across our entire portfolio that are most relevant to our clients in growing market segments."
GlobalFoundries and Samsung have a joint technology agreement, though it appears the deal will not extend to the fabrication of 7nm chips.
While a difficult feat, shrinking die size increases the density of a given chip to fit more transistors into a smaller space, thereby presenting a number of performance and efficiency improvements. For consumers, benefits typically include a reduction in power usage that can help increase battery life, lower heat production, and a boost to processing capacity.
AMD announced that it would move its 7nm production to TSMC, Reuters reported Monday.
In 2013, Apple reportedly tapped GlobalFoundries to fabricate what would become its A9 system-on-chip for iPhone and iPad, but backed away from doing so at the last minute, in favor of TSMC.
GlobalFoundries' decision comes months after TSMC ramped up production of its own 7nm chips, a healthy portion of which are likely bound for iPhone and iPad. As a fabless manufacturer, Apple designs its A-series silicon and outsources production to firms with foundries, such as TSMC.
Samsung was an original fab partner, but lost exclusivity starting with the A8, which for reference was built using a 20nm process. TSMC has been Apple's lone A-series chip fabricator from the 16nm A10 Fusion forward.
GlobalFoundries announced Monday that it is backing away from its ambitious plans to develop next-generation semiconductor technology, and will instead refocus its investment on existing technologies.
According to AnandTech, the shift means GlobalFoundries will drop five percent of its staff. The move also means the only remaining players in the next-generation semiconductor space are a pair of current and former Apple suppliers, TSMC and Samsung, respectively, and that the consumer electronics industry as a whole whole may very well find itself more dependent on those companies.
"Demand for semiconductors has never been higher, and clients are asking us to play an ever-increasing role in enabling tomorrow's technology innovations," GlobalFoundries CEO Tom Caulfield said in a statement released by the company. "The vast majority of today's fabless customers are looking to get more value out of each technology generation to leverage the substantial investments required to design into each technology node. Essentially, these nodes are transitioning to design platforms serving multiple waves of applications, giving each node greater longevity. This industry dynamic has resulted in fewer fabless clients designing into the outer limits of Moore's Law. We are shifting our resources and focus by doubling down on our investments in differentiated technologies across our entire portfolio that are most relevant to our clients in growing market segments."
GlobalFoundries and Samsung have a joint technology agreement, though it appears the deal will not extend to the fabrication of 7nm chips.
While a difficult feat, shrinking die size increases the density of a given chip to fit more transistors into a smaller space, thereby presenting a number of performance and efficiency improvements. For consumers, benefits typically include a reduction in power usage that can help increase battery life, lower heat production, and a boost to processing capacity.
AMD announced that it would move its 7nm production to TSMC, Reuters reported Monday.
In 2013, Apple reportedly tapped GlobalFoundries to fabricate what would become its A9 system-on-chip for iPhone and iPad, but backed away from doing so at the last minute, in favor of TSMC.
GlobalFoundries' decision comes months after TSMC ramped up production of its own 7nm chips, a healthy portion of which are likely bound for iPhone and iPad. As a fabless manufacturer, Apple designs its A-series silicon and outsources production to firms with foundries, such as TSMC.
Samsung was an original fab partner, but lost exclusivity starting with the A8, which for reference was built using a 20nm process. TSMC has been Apple's lone A-series chip fabricator from the 16nm A10 Fusion forward.
Comments
Given their resources, it’s probably the best road to profitability, for them. Developing chips for fabrication at 7nm (and beyond) is extremely expensive, and most customers won’t be going there anytime soon. I suspect they’ll re-visit 7nm three to five years from now when it’s less expensive for them to implement, and for their customers to utilize.
Like Steve Jobs said ‘For Apple to succeed, Microsoft does not have to lose’
But my guess is that eventually this will catch up with them. Given how difficult the 7 nm process is, you can’t just show up a few years down the road and suddenly decide you want to participate after all...
but I think there is a serious answer to that question.
The cost of new process nodes is exploding. We will soon be at a point where new nodes yield more expensive transistors, not less expensive. The only companies that will pay for chips fabbed on these new nodes are those that highly value performance per watt and have very deep pockets. I just described Apple.
so in a way, this is possibly good for Apple in the sense that it is bad for smaller companies that can’t afford to fund massive investments in capital and R&D.
But this is clearly bad for consumers — it means less competition.
TSMC and Samsung have pulled ahead, and rather than spend boatloads of money to try to catch up and still fail to secure the lucrative contacts, we’re going to wait on the sidelines for the scraps.
Fabs for the scraps can still be profitable because there’s little competition...
And we can mentally superimpose the cost curve of investments needed to fund new processes with the same steepness, just going up from left-to-right rather than down.
The big question -- who falls out next? My guess is that it won't be TSMC, but between Samsung and Intel it's a tough call.
GF has always been a more minor player, even when they were still part of AMD. With a 10nm fab costing at least $15 billion, and closer to $20 billion, not all can play in the space of 7nm, which cost much more.
These are all for CPU related fabs. There are several dozen fabs that do other work that are doing well.