How GlobalFoundries' "major announcements" today impact AMD

GlobalFoundries, the AMD spin-off and contract manufacturer of computer chips, will hold its first-ever technology conference today. Exactly what GlobalFoundries will reveal is still uncertain--the agenda is heavily focused on its 28nm manufacturing process--but the foundry has been hinting at major announcements regarding its technology and products.

Why does this matter? AMD is counting on GlobalFoundries to continue to manufacture nearly all of its processors, and in the not-too-distant future, its discrete graphics chips, which will no longer carry the ATI brand. Whether AMD will remain a counter-balance to Intel will be determined as much by GlobalFoundries' manufacturing prowess, as it will by AMD's chip designs.

The first thing I'll be watching for is any sign that GlobalFoundries' technology roadmap is slipping. In its last quarterly call, AMD revealed that 32nm was running behind schedule. GlobalFoundries' most recent roadmap showed 32nm entering "risk production" this quarter, but it now seems more likely that it will really happen toward the end of this year.

As a result, the Llano chip for mainstream and desktop replacement laptops-as well as mainstream desktops--has been delayed to sometime in the first half of 2011. In its place, AMD has pulled-in the release of Ontario, which will be manufactured by competitor TSMC using a 40nm process. Ontario is based on the low-power Bobcat core AMD unveiled at a conference last week, and it is designed for ultra-thin laptops and netbooks.

Both Llano and Ontario are what AMD refers to as Accelerated Processing Units, or APUs, meaning they have both a CPU and a GPU on a single piece of silicon. Intel is doing the same with Sandy Bridge, due in early 2011, and details are already leaking out but Intel it will have a lot to say on this at the Intel Developer Forum later this month. In effect, TSMC and Intel are vying to release the first monolithic CPU+GPU, though some argue that GlobalFoundries and Microsoft beat them to it.

AMD is also relying on GlobalFoundries' 32nm process for processors based on its Bulldozer core-also unveiled at Hot Chips last week--which will be used in high-end desktops and servers. These will launch sometime next year.

Though AMD is heavily focused on 32nm (and has promised from the start that GlobalFoundries would have an aggressive 32nm, 22nm and 15nm rollout), from the foundry perspective, the half-nodes (40nm, 28nm and 20nm) turn out to be more important in terms of competing with other contract manufacturers and attracting new customers. That is why the 28nm process is such a big part of today's agenda.

GlobalFoundries already has a 40nm low-power process for chips used in smartphones and other mobile devices, and according to its roadmap, it will start production of 28nm high-performance process for CPUs and GPUs in the fourth quarter, followed by a "Super Low-Power" version for mobile devices in the beginning of 2011. These will be critical for customers such as Qualcomm and STMicroelectronics, but the high-power versions could also be used to manufacture AMD's discrete GPUs, which are currently fabbed by TSMC on a 40nm process.

AMD's current 45nm CPUs and upcoming 32nm processors are manufactured on a special type of wafer known as SOI, or Silicon-On-Insulator. IBM also manufactures its Power processor for high-end servers on SOI, which has some performance advantages, but most chipmakers including Intel use so-called bulk silicon wafers, which cost less. GlobalFoundries' current roadmap does not include an SOI process after 32nm, which leaves a big question mark for AMD at 22nm starting around 2012-2013.

One other technology note: GlobalFoundries is part of an IBM-led alliance that has taken a different approach to the use of high-k and metal gates (HKMG) than that of Intel and TSMC. These new materials are critical at 32nm and beyond. There's been a lot of speculation that GlobalFoundries, and other IBM partners such as Samsung, will be forced to switch to something similar to the technique that Intel has already used to ship hundreds of millions of 45nm and 32nm processors. That wouldn't happen until after 28nm, but it will be interesting to see if GlobalFoundries has anything to say on HKMG.

I'll also be looking for updates on the company's manufacturing capacity. In June, GlobalFoundries announced that it was expanding its current fab, in Dresden, Germany, where it manufactures 45nm processors for AMD. The expanded fab will be used to manufacture processors at 40nm, 32nm and 28nm, as well as to develop the 22nm process. GlobalFoundries is also erecting a new fab in upstate New York. This fab won't even start volume production until early 2013 at 28nm (eventually moving to 22nm and 20nm), but the company has already announced plans to expand capacity there. At the end of last year, ATIC, the Abu Dhabi-based investment company that own most of GlobalFoundries, completed its acquisition of Chartered Semiconductor, an established foundry in Singapore, and it is expanding production there as well. ATIC also has visions of a new fab in the desert.

These ambitious plans are all about keeping pace with TSMC, the world's largest contract chipmaker, which is investing heavily to expand its own output. Whether or not GlobalFoundries can live up to its goal to be the world's most advanced foundry will to a large extent determine whether AMD can in fact close the gap with Intel.