TSMC Copies Intel, Announces Own Investment In Next-Gen Foundry Supplier
Under the terms of the deal, TSMC is investing €276 into developing extreme ultraviolet (EUV) lithography and 450mm wafer deployments, with a further €838 investment that buys it a 5% equity stake in the company. ASML is a vital company to both Intel and TSMC; it manufacturers the hardware that the two competitors use to build their respective products. Both EUV and 450mm wafer deployments are long-term priorities for the semiconductor industry, but both have been delayed by uncertain roadmaps and scaling difficulties. By buying directly into their own supplies, Intel and TSMC are obviously hoping to see a superior return and product ramp.
"One of the biggest challenges facing IC scaling today is how to effectively control the escalating wafer manufacturing cost," said Shang-yi Chiang, TSMC executive vice president and co-chief operating officer. "We are confident that the additional funding for ASML's research and development programs will help secure and accelerate EUV development activities, in parallel with the necessary focus on improved performance of existing optical lithography tools and speed up the deployment of new technologies for 450 millimeter wafers. This effort will help the industry control wafer cost, and therefore protect the economic viability of Moore's Law."
Both technologies are difficult to implement, though for different reasons. With 450mm wafers, the issues are more related to quality control and equipment compatibility; 300mm wafer production lines can't easily be retrofitted for 450mm products. It takes time to ramp ingot supply, wafer-cutting equipment, and to ensure that 450mm defect densities are equal to or smaller than 300mm levels. Thus far, Intel and TSMC have pushed for 450mm, while Samsung, GlobalFoundries and UMC have focused on 300mm production.
EUV is difficult for a host of other reasons. Current immersion lithography has all but reached its maximum resolution. The techniques used to extend it to below 22nm, like quad-patterning, are stopgaps with significant downsides of their own. EUV is difficult for multiple reasons, one of which is because it takes nearly an order of magnitude more power to match immersion lithography's wafer throughput. Bringing power down while maintaining high throughput is a major goal of ASML's, and these investments will drive such research.
We've discussed how the shifting semiconductor market is making new partnerships necessary and changing the overall business model; this news from TSMC is further evidence of that. ASML isn't the only lithography supplier, but so far there's no word of whether or not other foundries like Samsung, GlobalFoundries or UMC will announce deals with rival firms like Applied Materials. With Intel and TSMC now having committed to pouring several billion into EUV in a bid to bring that tech to market more quickly, others may feel they have no choice but to ratchet up their own levels of investment.