Providing a little more context before things get blow out of proportion.
This is the first time TSMC has done two large feature set in one node generation. TSMC's N2 will first use gate-all-around (GAA), with an improved N2P coming with BackSide Power Delivery Network (BSPDN).
As with any new large node features, capacity will be constrained, so instead of the usual one additional Fab online per year expansion in leading node, they are bringing online 3 in the space of 2 years. This is also discounting that we dont know the total Wafer output of each Fab. But if we look at the recent Q4 report it does seems HPC ( or likely AI ) has infinite appetite for wafer capacity. So I wont be surprised if it is indeed a substantial increase in wafer capacity on leading node.
We will know ( or we can infer it ) once they start doing 2nm revenue reporting. TSMC tends to be very transparent with these sort of things. Something I hope Intel IFS will copy as well.
Could you please elaborate for the general HN public what TSMC is doing and how they are advancing too fast while Intel (also AMD?) are "stagnated"? I am not talking about bashing Intel but it seems there is a lot to talk about TSMC from the science, engineering, and business execution perspectives. It seems like TSMC is playing a complete new game in the chip industry.
TSMC only does fabrication, no chip design. Pretty much everyone making high-performance parts other than Intel sends uses them, AMD included. This is typically known as the “foundry” business. They are the biggest pure foundry by far, and all of their competition has some downside (Intel and Samsung aren’t pure foundries, you have to compete with their in-house demand, Global Foundries is behind and isn’t competing for the smallest nodes anymore, and SMIC is a state-owned Chinese company and, among the other concerns that brings up, they can’t get access to the latest photolithography machines for geopolitical reasons).
Speaking of politics TSMC, is in a unique geopolitical position. Their government sees being the chip foundry for the whole world as an existential issue. China would like to take over Taiwan for historical reasons, and they can’t possibly build a large enough army to defend themselves against a really motivated full-strength attack. So instead they have put themselves in a position where any attack would be incredibly disruptive to the global economy and anger everybody.
The silicon industry is famous for very long roadmaps, very long investment payback times, cyclic demand, and winner-take-all competition. It is brutal. TSMC, serving everyone and with a friendly government at their back, is in a good position to out-endure everyone.
That’s the business part. The science and engineering is over my head, and I think sort of hard to talk about. Each node is a new engineering marvel basically.
Thank you, it is clear that there should be an engineering marvel there and/or as you said it is a natural monopoly.
I also asked because I remember in the early 2000s talking with people from Tower [1] and at that time tgey were super bullish for the model I think it does not work pretty well from them even with top-notch engineers.
IMHO, it's better for Apple to be a foundary customer than to run an internal foundary.
As a customer, if TSMC falters, they can switch to Samsung or Intel (if Intel foundary materializes).
As a vertical foundary, it's very hard to switch if it falters. AMD managed to spin out their foundry which was becoming non-competitive and switch to TSMC, Intel has a lost decade because of the pipeline bubble caused when the Intel 10nm foundary arrived late and with poor yields.
Apple has a very hard time selling to business, and I think would not be able to credibly provide foundry services to others, so it only works if they can keep it on the leading edge.
Never say never but I suspect they are quite happy with the current setup. Apple makes premium devices. Everybody needs a mix of chips but their needs skew toward the newest node. They can instead pay TSMC a bunch of money to reserve capacity on the next node, funding the construction of the facilities, in exchange for a spot at the front of the queue. Then, when the node after that shows up, they can move along, and TSMC can continue using it for lower-margin companies.
>At what point will Apple try to build/buy their own foundry?
Likely never. As long as you understand how foundry works, economy of scale, long tail of older nodes, capacity planning and amortisation of R&D.
i.e Unless Apple is happy to Fab for their Android competitors and their Android Competitors are also somehow happy to buy from them the likely hood of that happening is practically zero.
Apple is exactly like the CCP; It has a 10, 25, 50 year roadmap that it secretly works on.
Recall that famous article about the "largest hedge fund nobody has heard about" -- Apples hedgies that were a couple of people in Reno Nevada?
Surely they have been looking at the math forever - I wouldnt be surprised if they have already pulled the trigger on something.
However, they are masters of supply chain - and were investing in companies that are inputs to their supply chain, and rig the system for their own margins.
They would buy up a companies capacity for a component, and invest in them, and basically own that node in the chain.
> At what point will Apple try to build/buy their own foundry?
As soon as they are tired of having money.
It isn’t just the cost of building Fabs, literally their entire supply chain is based on being Fabless, and changing that is ridiculously expensive. They have some amazingly skilled chip designers inhouse, but even so many aspects of the actual manufacturing side of the design process were not done at Apple, although they exert an outsized influence.
I think it's pretty clear that the importance of TSMC will decline at the same rate as the price per transistor decreases ever more slowly. Chip companies don't need the most recent node when it offers hardly any improvement per cost.
The slower the progress, the easier it is for competitors to catch up "close enough". Currently being two years behind the bleeding edge makes a significant difference, but not as much as ten years ago, and probably more than a few years from now.
Actually, isn't it quite clear that the complete opposite of what you said is true? TSMC's importance is at an all time high right now even though, as you said, being 2 years behind doesn't make as much a difference as it did 10 years ago.
I don’t think that’s clear at all. All I’ve seen is many small fabs closing down were close enough to bleeding edge wasn’t sustainable. Intel is only surviving its last (and current?) fumble because of their past lead.
Though maybe I’m just out of the loop? who are the accessible close enough competition that you have in mind?
The writing is indeed on the wall for TSMC's (and consequently Taiwan's) political value.
The entirety of the western world has made it clear, with cold hard cash and sheer political will, that they want out of the singular egg basket that is Taiwan.
Noone wants to be in the path of the inevitable freight train that is One China(tm).
We’re both moving at the same time of course, the US has a huge amount of resources, so I’m sure if we had, say, a decade long really focused manufacturing-based economic policy there’s nothing they could do to keep us from taking the crown.
Alternatively if we catch a unicorn and contact some aliens maybe they’ll tell us how to make CPUs out of the horn.
Engineering wise Intel was part of EUV LLC in the late 90s but sold off their portion later in the 2000s I believe. It was a public/private partnership to develop EUV lithography and is the reason the US is able to dictate EUV machines not go to China.
Trying to ELI5-style compress an answer to 'explain the chip industry' means you have to be very opinionated in a way that's uncomfortable, and the way the question was framed, part of the answer will sound wrong to you.
TL;DR: TSMC bet on a particular manufacturing method (EUV), and it paid off. The company that makes the machines for that method is absurdly backordered. Also, people way overrate how ahead TSMC was/is, there was a halycon moment where Apple went ARM on desktop _and_ had exclusivity on TSMC's best node improvement in years. People were doing Apple's to oranges, ascribing the improvements from the die shrink to Apple's genius / TSMC's manufacturing. For verification dig into Apple community's in-depth reaction to recent M3 release, you'll find the take is generally def. not worth the upgrade if you have M2.
They did some of the engineering behind the fundamental tech but later dissociated from it, then later didn't invest in buying and integrating it (EUV machines) when it was on the verge of production and missed out. I believe their first in-house fabbed chips with EUV only released within the last month or so, Meteor Lake.
It takes ~3 years to stand up a fab and has only been 5-6 since EUV was proved out with first mass production.
Intel are catching up and will likely launch their 20A node before TSMC 2nm. Intel's 20A also includes gate all around and backside power delivery, so I don't think it's accurate to say Intel are 'stagnated' any more.
According to Intel's schedule, yes. Intel's schedule has 20A coming in Q3 2024.
However, according to Intel's schedule, they've been at Intel 3 since Q3 2023 (and Intel 4 since Q3 2022). The first Intel 4 processors actually launched in December 2024, 17 months after Intel 4 on their roadmap. We've yet to see any Intel 3 processors. I'm not accusing Intel of lying. Their roadmap can be when they've achieved a milestone rather than having it at the scale to start shipping chips. To be realistic about Intel's roadmap, 20A processors are probably coming in December 2025 at the earliest. That is earlier than TSMC's 2nm with gate all around and backside power delivery, but then there's also the question of whether Intel will actually pull it off.
I do like that Intel is recommitted to its fab, but I'd also say that it's too soon for me to believe that Intel will overtake TSMC. Why? Intel 4 is behind TSMC's N5 process in transistor density and Intel has only shipped a single line of processors with it - and they've had to use TSMC's N5 and N6 for the graphics and IO tiles. Basically, Intel has started shipping Intel 4, but not for most of their processors - none of their desktop or datacenter processors are using it.
There is a possibility that Intel will pull it off and I agree that Intel isn't stagnating anymore, but I'm not sure I'd go as far as saying it's "likely" that Intel will overtake TSMC. Yes, TSMC is still struggling to get 3nm beyond Apple. Qualcomm's upcoming 2024 flagship chips are using TSMC N4P. But while Intel has been making progress way faster than it had for a decade, their progress hasn't been as stellar as their marketing of it. Intel 4 doesn't match 5nm transistor density, Intel 3 still seems to be a mystery, and Intel is shipping few Intel 4 processors. Does Intel 20A end up falling between TSMC's N4 and N3P? Does Intel ship one processor at very low volume with 20A in December 2025 and it's late 2026 or even 2027 before they've got all their processors there?
It just the kind of situation where there's a lot of nuance because it doesn't matter what a company has "achieved". It matters what parts you can buy and at what price. I can get Apple products with 3nm, but it looks like Android devices won't be getting 3nm until 2025. That's available, but not to most people. Even if Intel "achieves" 20A: at what volume, at what transistor density?
> Could you please elaborate for the general HN public what TSMC is doing and how they are advancing too fast while Intel (also AMD?) are "stagnated"?
AMD hasn't stagnated, they've made some serious progress in the last years, and they've long ago gone fabless - they spun off GlobalFoundries in 2009, and mostly deal with TSMC. The biggest problem AMD has when compared to anything ARM is the instruction set - x86 carries a crapton of baggage with its 40-ish years of history and backwards compatibility, while ARM is relatively clean.
Intel stagnated because they messed up big with their node shrinking and for inner-political reasons couldn't say they go with TSMC as well so they were stuck with their old nodes.
Judging from questions like why dont Apple buy TSMC or built their own foundry I would guess a lot more context will be needed and it would be at least a few thousands words if not more.
But to put it short, and one point that is not pointed out enough. TSMC has always been the leading edge foundry for nearly all SemiConductor company apart from Intel and AMD. If you want the most advance third party foundry, you basically only have TSMC to choose from. That has been the case since at least 2008. ( Or arguably a lot longer ). So for pretty much everyone in the industry nothing much has changed. TSMC mapped out their roadmap, speak to a few key client on their needs and capacity, plan their investment and ROI accordingly. The only thing that had changed is that they somehow not only are the leading edge on Foundry services, but also leading in terms All Silicon producer, where Intel used to be the king. So one way to think about it, is that TSMC has been executing like clock work for the past 20+ years. While Intel has multiple minor slip and one major slip in terms of node process, and also completely missed out on Smartphone revolution which provided an additional 2 Billion+ consumer electronics market using silicon chips, and they didn't get to enjoy the amortization over those potential 2 Billions unit volume. Even if they did like the 200M Apple Modem order, they completely failed to plan the CAPEX and OPEX spending and capacity planning. Which was later confirmed Intel's CEO Bob Swan. ( Not his fault. It was all on Brian Krzanich ). So to answer your question. "how they are advancing too fast while Intel (also AMD?) are "stagnated"?"
It was't TSMC moving too fast. It was Intel completely fucked it up. I wrote a lot about how Intel should have done Foundry in 2011 and how they missed everything by 2014. But a lot of these were only obvious now. Some of my comments below from 2016 and 2020.
Edit: That doesn't mean I am negative on current Intel. I was so happy and cried when Pat Gelsinger got back to Intel as CEO. It is a tough battle. But if Pat dont make it work then I doubt anyone else could either.
Copying what I wrote in 2020 [1]
>Tl;DR, It is TSMC, not Apple.
I have been thinking starting a blog on the topic considering how often this question keeps popping up. From a very high level overview.
1. Apple is partnering with TSMC. TSMC is now the leader in leading edge semiconductor manufacturing. A title that used to belong to Intel.
2. TSMC is now a generation ahead of Intel, meaning those thermal efficiency you see comes from using a better node. Nothing much to do with ARM or x86.
3. Both ARM and TSMC has dramatically change the Industry, you can now buy Designs / Blueprints from ARM, ( Or any other IP vendors such as Img PowerVR ) and Fab ( meaning producing them ) them with a Foundry.
4. TSMC is a Pure Play Foundry, meaning the Foundry does not produce their own chip and sell in the market to compete with its customers. A Non Pure Play Example would be Samsung or Intel, where Samsung produce their own Mobile SoC Exynos, and Intel with their x86 Chip. If you were Qualcomm producing your chip in Samsung's Fab, you are directly competing with them.
5. Apple now has the volume, or economy of scale to produce CPU themselves. Apple makes more silicon in unit volume than Intel per year.
Another Comments I wrote in 2016 [2]
> These process, R&D, process optimization, materials science are all cover by their cost to TSMC / Samsung. Btw TSMC's 2016 Capex ( including R&D ) is now equal to Intel $9.5B. When you consider TSMC is Pure Play and Intel being IDM, this is very significant mile stone.
Since nm are Now Marketing, unrelated to physical dimension, how consequential is this node shrink? It must have passed some threshold to justify new factories - what was it?
"In July 2022, TSMC announced that its N2 process technology will feature backside power delivery and will offer 10–15% higher performance at iso power or 20–30% lower power at iso performance and over 20% higher transistor density compared to N3E"
> Since nm are Now Marketing, unrelated to physical dimension
That's not entirely true. They might not decrease the minimum gate length, but generally the improvements made when bumping down the "nm" number has been a similar improvement as what making the gate length smaller would have given. So I don't find the numbering as misleading as others think.
It's not like any of us a designing gate cell libraries (well, I have, a very basic one, but I'm guessing most here haven't), and actually care about the gate length.
Using the minimum gate length as a naming scheme was always been a proxy for things chip designers actually care about: logic density, timing, power, etc.
I have no inside information, but gate-all-around and backside power are both pretty big developments. If you remember the rise of finfet, gate-all-around will probably be a similar step up (maybe slightly smaller). My guess is backside power is the less impactful of the two, and a little less directly quantifiable, but for route-limited designs it should enable 10-20% higher density which reduces cost and improves performance. It may also deliver higher quality power supplies, which improves power efficiency and maximum clock frequency.
It's hard to directly answer "how consequential", but it seems like it could be as significant as the step to TSMC 16nm.
Marketing sure painted themselves into a corner on this one by counting backwards, they only have one generation left before things get weird. Will they use fractions or go negative?
As you said N2 seems to be some sort of major milestone... and why 3 fabs? Well, I would naively say that will help TSMC production capacity to avoid being "trusted" by a few vendors and let alternatives access state-of-art N2... finally risc-v powerful micro-archs with N2?
> "it usually builds a new fab to meet demand of its alpha customers and then either adds capacity by upgrading existing fabs or building another facility. With N2 (2nm-class), the company seems to be taking a slightly different approach as it is already constructing two N2-capable fabs and is awaiting for a government approval for the third one."
Customers would probably want to have plants outside of Taiwan, but proactively approving a new plant and starting to build one even before you have customers gives more leverage to Taiwan. This is just as much about Taiwan's security as it's about good business.
The fabs don't really have strategic value because the pace of development has slowed down. The fabs are presumably rigged for easy sabotage, so if something... happens to Taiwan, neither China nor the West can make use of them. It would barely affect the state of the art since Samsung is not far behind and Intel will eventually get its sh*t together again. And key parts of the supply chain are in the West, and China's access to it is already restricted.
Edit: they have massive economic value of course, but economic factors alone have rarely prevented conflicts.
If TMSC fabs go down, the world silicon foundry output would drop by a significant chunk. That could have an effect but the majority of the worlds silicon use is in less advanced nodes which many companies produce, it would slow down the state of the art sure, but it probably not be as catastrophic as some people imagine.
Even if China invades Taiwan and no sabotage happens to TSMC, sanctions would mean TSMC won't produce anything for years, and during that time other companies will catch up.
It's easy to dismiss economic impact in conflicts. Even the phrasing "economic factors alone have rarely prevented conflicts" is a little glib. US administrations (and all others) have to remember how the Cold War ended; The Oil Shock; the effect of fracking on the viability of action in the middle east (thrown together in one salad :-); the whole point of much conflict in the middle east; the Houthis firing at ships passing by; etc, etc.
So not all conflict is tied-in with economics sure but wouldn't loosing most TSMC production and china-based supply chains be a major shock? For all sides? And as such would be taken into account?
The chip foundries are just one factor in the importance of Taiwan. What matters more is that control over Taiwan would vastly simplifies to exercise control over what China perceives as their territorial waters (not just as their Exclusive Economic Zone!). The economic impact can be tanked by a national economy and is easily justified in the name of furthering national security, as it would severity weaken US influence in the whole region.
At the same time, you would think by now there would be better planning - preserving useful farming soil for farming. But yeah, the difference is too high for most places to bother. In any country I know of.
It's fair also that some farming activity is not very compatible with high human density nearby, such as spraying and dust. So it's hard to intersperse high rises with production farmland.
If this isn't a joke, you are wrong. What a world we live in.
> Today, terms such as “2 nanometer” and “3 nanometer” are widely used as shorthand for each new generation of chip, rather than a semiconductor's actual physical dimensions.
Its almost as if we live in 1984 where newspeak goes un-noticed
I think that’s a popular sentiment, but we should all appreciate the person who answered your question as if it was good-faith, right? That’s a good instinct for somebody to have.
for sure... I didn't down-vote him unlike some other people... I can't down-vote on this account anyways (I actually up-voted him because I saw his comment had been shadow banned, which is another terrible practice... humans are messed up, I hope AI takes over, for the better or the worst)
Reminder that technology nodes (5nm, 2nm, etc.) refer to the smallest feature, not some dimension of the transistor channel. For reference, a silicon atom is 0.21nm.
They used to refer to the smallest features, but they haven't had any real meaning for a long time now. The names of the nodes don't correspond to any physical feature of the actual transistor anymore.
Who cares? It's not like most of us are designing logic gate cells for chips. The transistor dimensions are irrelevant to us.
I really don't understand why this keeps getting brought up. It's not even an interesting fact.
When the chip manufacturing industry started finding other ways to increase logic density, improve timing, reduce power consumption, etc, they just started bumping down the "nm" number to indicate the improved performance, in a similar way as reducing the transistor gate length would have done before. Simple as that.
This is the first time TSMC has done two large feature set in one node generation. TSMC's N2 will first use gate-all-around (GAA), with an improved N2P coming with BackSide Power Delivery Network (BSPDN).
As with any new large node features, capacity will be constrained, so instead of the usual one additional Fab online per year expansion in leading node, they are bringing online 3 in the space of 2 years. This is also discounting that we dont know the total Wafer output of each Fab. But if we look at the recent Q4 report it does seems HPC ( or likely AI ) has infinite appetite for wafer capacity. So I wont be surprised if it is indeed a substantial increase in wafer capacity on leading node.
We will know ( or we can infer it ) once they start doing 2nm revenue reporting. TSMC tends to be very transparent with these sort of things. Something I hope Intel IFS will copy as well.