If TSMC dominates Samsung, it’s also (and above all) due to its insane profits

With a rumored 60% to 80% yield on the new 3nm etch, TSMC has already won the race at this node against Samsung, whose process is much more complex. This highlights one of the advantages the Taiwanese have over their Korean rival.

The differences between Samsung and TSMC’s foundry services are legion, whether in country of origin, business structure, or the technologies used. But out of the box, the main and most fundamental difference is this: TSMC’s returns are incomparably better. When TSMC announces the start of mass production of 3nm chips on December 29th – we imagine for Apple – this new production hub will already show some impressive results. According to unconfirmed data leaks from TSMC (like the CIA, it never denies or confirms!), the productivity of this start of N3 production (the “classic” 3 nm node) will fluctuate between 60% and 80% good chips. . By comparison – and again with numbers scrubbed behind the scenes – Samsung’s EUV burning debut was limited to a 20% yield rate. And since then, the improvements will be small.

How can we be sure of these numbers from under the clothes? According to the results received by the group, that is, as a whole. Even though TSMC is in high demand and therefore more expensive than Samsung, and some players like Qualcomm or Nvidia go to Samsung to take advantage of better prices, everyone keeps coming back to TSMC. Whether it’s RTX4000 graphics chips or Snapdragon 8 Gen 2 smartphone chips, almost all the chips you use on a daily basis in your smartphones, tablets, and even your computers (if they have an Apple or AMD chip) come from TSMC.

Also read: Nvidia announces GeForce RTX 4090 and 4080: they explode in terms of performance… and prices? (September 2022)

Because the consumer electronics market requires the ability to produce many chips quickly. This is possible only when the maximum quality chips arrive at the end of the chain in silicon wafers.

TSMC also excels in efficiency

TSMC has captured the market share of state-of-the-art nodes.  /FinancialTimes
TSMC has captured the market share of state-of-the-art nodes. /FinancialTimes

However, do not believe that TSMC is dominant only with good productivity and a mass of cheaper manufactured chips. As we can see, the services of the Taiwanese have a price, and it is more Samsung that tries to lower prices to attract customers. Because the Korean is only picking up the scraps: TSMC already holds about 55% of the global semiconductor market, but with all nodes combined, this proportion increases to 90% (!) in advanced nodes. That is, chips etched at 7nm or less and manufactured using ASML’s extreme ultraviolet (EUV) machines.

Also read: Snapdragon 8 Gen 1 Plus: Qualcomm’s next high-end SoC to be carved by TSMC (March 2022)

If customers from all over the world want to go to TSMC, it is also for the energy efficiency of the chips it produces. We saw this during the traditionally imperceptible transition between the Snapdragon 8 Gen 1 carved by Samsung at 4 nm and the Snapdragon 8 Gen 1+ carved by TSMC (N4). Although the nodes were similar on paper, TSMC’s second chips not only required less power, but were also more capable at upscaling.

It comes above all else

The moral of the story may be that productivity is a higher priority than manufacturing technologies and chip structure. While giants like Intel are cautious about EUV machines and favor deep structural improvements, TSMC has focused on rapid industrialization of ASML machines to improve performance through thinness. Even if Samsung starts manufacturing new GAAFET-type transistors at 3nm, TSMC prefers to continue to push the boundaries of FinFET… Again, for productivity.

However, FinFET’s limits are evident and the “wall” of miniaturization is approaching. If TSMC plans to launch thin etching at 2nm from 2025, the 1nm horizon is more uncertain. New transistor structures—whether in terms of spatial compatibility (GAAFET) or power supply—are areas of improvement that are necessary in the race for improvement. But the commercial success of their deployment depends on the perfect timing of the application.

We feel here that greater foresight is what gives TSMC the edge over the rest. needs of its 500 customers and to start the industrialization of technologies at the right time. Far from being cautious, TSMC was the first to start producing sub-7nm chips with EUV scanners (steppers) from ASML. But like Apple, the Taiwanese know the right time to introduce technology better than anyone. That is, the moment when it can be deployed en masse. Maximum revenue (and therefore cash) is at stake.

Source:

Tom’s Hardware (USA)

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