The race is on to catch up with Intel

With each new generation of processors, as feature sizes approach atomic scale, it is getting harder--and more expensive—for chipmakers to follow Moore’s Law. Intel has long led the way, but lately there has been a lot of debate about whether its lead is growing a bit too large. In a bid to catch up, the rest of the industry is suddenly changing its roadmaps and forging new alliances.

Intel has deep pockets, and because it makes its own chips, it can tailor the manufacturing process and processor design to get the best results. That means it is first to release chips with the smallest dimensions (not counting memory, which is a different animal). These “shrinks” worked for decades. But starting around 2002, when Intel released its first 130-nanometer Pentium 4 processors, simple scaling began to run out of steam. Since then Intel has introduced a series of innovations--strained silicon, new gate materials, and most recently, 3D transistors--to continue to make chips that are denser, faster and use less power. Intel is now counting on this technology lead, not only to defend its monopoly in PCs and servers, but also to expand into smartphones and tablets.

At one time there were lots of other IDMs (Integrated Device Manufacturers), but an increasing number of companies design chips and hire foundries to manufacture them. AMD is the most prominent example, having spun-off its manufacturing arm to establish GlobalFoundries, but many others have turned to fab-lite or fabless strategies. Major semiconductor companies such as Freescale, NXP Semiconductors, STMicroelectronics, Texas Instruments and Toshiba have all shifted more work to foundries in recent years. That cuts costs, but it also leaves them at the mercy of foundries. This works fine as long as the foundries stay close behind Intel. But as scaling becomes more difficult, the foundries have struggled to duplicate innovations like high-k materials and metal gates (HKMG) or 3D transistors, better-known as FinFETs. The foundries have the added challenge that they must serve lots of different customers and build lots of different types of products.

Intel began volume production of 22nm processors using FinFETs late last year. On the company’s recently quarterly call, CEO Paul Otellini said the 22nm “ramp” was ahead of schedule and the latest Ivy Bridge chips are now a quarter of its total PC production. Intel doesn’t provide exact numbers, of course, but that means it is churning out perhaps 225,000 Ivy Bridge chips per day on its 22nm process with FinFETs. This will be followed by a new microarchitecture, code-named Haswell, early next year, and by early 2014 Intel is scheduled to ship its first 14nm processors.

Meanwhile the foundries are ramping the 32nm/28nm node and perfecting HKMG technology. TSMC, the world’s largest foundry, shipped its first mainstream 28nm product, AMD’s Radeon HD 7970 graphics processor, in December 2011, but it won’t be able to meet demand for 28nm capacity until the end of this year. After struggling with manufacturing yields last year, GlobalFoundries now seems to be producing enough AMD processors on its 32nm process with HKMG, but it won’t get to 28nm until next year. Similarly UMC won’t have 28nm with HKMG in volume production until next year. Samsung’s latest Exynos 4 Quad processor is manufactured on a 32nm process, with HKMG, but it still manufactures Apple’s A5X, the chip in Apple’s latest iPad, on an older 45nm process. Until recently, no foundry had planned to shift to FinFETs until the 14nm node, which is still years away.