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Is Intel's venture into the foundry business abruptly taking a risk or a meticulous breakthrough?

April 28, 2021

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In the first public speech of Intel’s new CEO Pat Gelsinger, he mentioned that Intel will also open its foundry business and open up its experience in semiconductor design and production to the entire industry, which is also an important part of Intel’s IDM 2.0 plan. The foundry business will become an independent business unit, under the charge of Randhir Thakur, a senior semiconductor veteran and an executive in Applied Materials, who will directly report to CEO Pat Gelsinger.

Intel has now opened its existing foundry services to the industry, starting with 22FFL process technology, and in the future will invest 20 billion US dollars to open two foundries in Arizona to provide customers with customized generations using EUV lithography technology.工服务。 Service. In addition to opening up the advanced process technology to foundry, Intel also provides advanced 2D and 3D packaging technologies such as EMIB and Foveros.

Apple and Intel will be divided for a long time, and for a long time will they be combined?

For any foundry business, Apple is undoubtedly the biggest customer. Intel and Apple have been in a relationship "both competitors and partners" for a long time. Intel is the defender of the PC, and Apple is the new Mac camp, but the latter has continued to use Intel's CPU for the past ten years. However, this situation was broken after Apple released the Macbook notebook with the M1 chip. Apple directly used the previous generation Macbook equipped with Intel to highlight the performance and power consumption of the new chip, and Intel was not to be outdone, and even launched a dedicated page. Compared.

After Intel started its foundry business, ARM processors are also among the foundry objects. As long as Intel can surpass the process technology, or provide more stable production capacity, not to mention the foundry of Apple's notebook chips, even the mobile phone chip foundry will have the opportunity to fight for it. Intel is likely to become a customer and competitor of Apple again. But from the current process and production perspective, Apple will not hand over Intel to foundry chips in the short term. Even if everything goes smoothly according to Intel's own roadmap, it will surpass TSMC at least after 2025.

A nightmare of profit margins?

With large investments in the construction of foundries and advanced process research and development, many Intel investors are concerned about whether Intel's profit margin will plummet because of this. After all, Intel is the IC company with the top profit margin. Although this kind of concern is reasonable, it is also a concern that Intel must abandon in its pursuit of a breakthrough, not to mention the foundry business means a larger market. According to Intel's forecast, the foundry market in 2025 will reach a scale of hundreds of billions of dollars. TSMC, which is only supported by its foundry business, also achieved the highest profit margin in the world.

You must know that Intel did not spend less on the exploration of 10nm. Whether it is R&D and factory building, it has invested a lot of money, but Intel's idea at the time was how to solve the "problem" of DUV lithography machine, instead of decisively choosing EUV. Lithography machine transition. What's more, Intel has found the US government as a backer. In the US plans and bills to improve the semiconductor supply chain and restore its dominance, Intel has occupied an important position and is also one of the main targets of funding and investment.

Moreover, although the manufacturing process lags behind others, Intel still has enough experience in technical preparations, especially in GAAFET and MBCFET technologies, but it has only fallen behind on 7nm. What's more, Intel's foundry business will start from mature itself such as 22nm and 14nm, which can also ensure that its profit margin will not plummet.

OEM business is making a comeback?

This is not the first time Intel has tried the foundry business, but because no one wants to put the work of chip manufacturing in their hands. Why is this? Are other manufacturers afraid that Intel in IDM mode will capture their chip designs? it's not true. Intel’s foundry services are not focused. Their manufacturing process is heavily tied to their own chip design. They are mainly used for high-performance computing, but they are inconsistent with other manufacturers in the design of low-power chips. This is also the reason why TSMC and Samsung are successful. Their IP lineup and PDK are far better than Intel.

Pat Gelsinger also mentioned in the interview that Intel's foundry business in the past was more like a "half bucket of water". Now it has become an independent department and has opened up advanced manufacturing processes and packaging technologies, which is also more attractive to customers. It is no wonder that Qualcomm, Microsoft and a large number of IP vendors will endorse it.

From x86 to serving ARM and RISC-V?

Intel’s foundry is taking a fully open path. In addition to its own high-performance computing applications, Intel will also provide foundry services for low-power applications, including non-x86 chips such as ARM and RISC-V. And IP. Patrick Little, CEO of SiFive, a well-known RISC-V IP provider, also announced a cooperation with Intel foundry services to provide customers with SiFive's 32-bit and 64-bit core IP.

Qualcomm, a giant in the ARM lineup, also expressed concern about Intel’s open foundry business. Its CEO Cristiano Amon emphasized that Intel’s flexible IDM 2.0 model provides an important choice for the entire semiconductor industry. In the future, it also looks forward to working with Intel on this basis. Expand further cooperation.

As a result, Intel can not only continue to play its own advantages on x86 and focus on R&D, but also learn better design experience with ARM and RISC-V architectures. Although Pat Gelsinger did not mention whether Intel will also use RISC-V and ARM architectures, with the further popularity of heterogeneity, Intel is also likely to adopt these cores in its own products in the future.

From the veteran Sunil Shenoy recalled by Intel at the beginning of this year, it can also be seen that Intel attaches great importance to the design of the future architecture. Although Sunil Shenoy has served as an engineering designer at Intel for many years, and went to SiFive as the vice president of engineering in 2017, returning to Intel now can be said to provide a powerful boost and excellent design experience for Pat Gelsinger's drastic reforms.

Summary

Speaking of IDM, Intel may be the last company of the same type. Although most people also have expectations for Intel's foundry business, they generally believe that Intel will spin off the business and operate independently. Pat Gelsinger rejected this idea. His view is that although the ideas of other foundries can be used in difficult situations, he hopes that most of the chips will still be manufactured by his own fab.

If Intel wants to do a good job in this foundry business, hemorrhage is indispensable, but Intel has been in awe for too many years. Under the leadership of the new CEO, let go, this may be the best way for Intel to break through the existing shackles select.