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Intel, China, TSMC & Reuters |
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Mar 14, 2007 at 02:43 PM |
I have lost count of the number of stories written about Intel getting approval to build a 300mm fab in China. Of course the news hasn't come from Intel, rather it stems from the Chinese Government. Intel must be getting very miffed over these Government leaks as the last one occurred in Israel. Many months later, Intel announced a new fab was to be built in that country.
Will Intel do the same over a China fab?
Probably, but the news in itself isn't that surprising, as Intel has needed extra capacity for chipsets for over a year, and its 200mm fabs will just get closed or sold to solar wafer companies over time. It needs 300mm fabs in order to lower costs of chipsets, and what better plan than to use cheap energy, water and the low taxes that China provides to help reduce costs.
I have not mentioned low labour costs, as this is not a factor in front-end fabrication, taking up only a few overall cost percentage points compared to the cost of equipment and depreciation. What does matter is having a pool of engineers to tap, and China doesn't have a problem there either.
If as is being suggested in the many news stories Intel will start with a 90nm process, Intel may ship tools from Fab11x to the China fab and keep new tool purchases down. Fab11x is getting a refit right now so the China fab makes sense from that direction as well.
That said, I read with interest a Reuters story with the strange headline, ‘TSMC says no big impact from Intel's new China fab.'
Shock horror!
The Reuters story (not surprisingly) fails to grasp the small point that TSMC is a foundry and Intel is an IDM. They are not competing as far as I can recall, unless someone can prove to me that Intel has a new business model!
Now, did Reuters call TSMC for comment on the Intel news believing there was a competitive issue?
I hope not, as that is just plain silly!
However, the story has a different message to relay and it's a message from TSMC to the Taiwan Government. In that sense, then, TSMC may have instigated the contact with Reuters, rather than the other way around.
TSMC pointed out that the technology node with which Intel wants to kick-start production in China is more advanced than they are allowed to use in their 200mm fab in the country. This has been a point of contention with TSMC for several years, as it really wants to compete properly on SMIC's own turf.
Hence the lack of qualification to the Reuters journalist from TSMC that Intel and TSMC actually do not compete. Hence also the fact that the story and the headline are simply naïve, but very effective from TSMC's perspective in keeping the heat on the Taiwanese Government.
A nice little PR victory for TSMC and another example of mainstream press naivety when it comes to covering the semiconductor industry. That's two in one day: I had better stop now!
The naïve Reuters story is reluctantly linked here:
http://www.reuters.com/article/
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| Senior Technical Program Manager (Dublin, Ireland, 02/04/2008) | | Senior Embedded Design Support Engineer (Shannon, Co Clare, Ireland, 19/03/2008) | | Embedded Support Engineer (Intel Shannon, Co Clare, Ireland, 19/03/2008) | | Senior Component Design Engineer (Intel Shannon, Co Clare, Ireland, 19/03/2008) | | Customer Engineer (Shanghai , 05/02/2008) |
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