The China Economic News (CENS) reports AMD has outsourced their 40nm CPU production to TSMC. According to CENS:
Some foreign institutional investors recently said Taiwan Semiconductor Manufacturing Co. (TSMC) has won foundry contracts to make central processing units (CPUs) for Advanced Micro Devices (AMD), the world`s No.2 computer-microprocessor supplier second only to Intel Inc.
They said the volume production would begin at the end of the second quarter next year and run with 40-nanometer process. The contracts, they added, would give a boost to the world`s No.1 silicon foundry`s revenue.
In reaction to the reports, TSMC`s executives haven`t made any comments, simply saying pursing CPU contracts has been one of the company`s plans. Industry watchers said the contracts coming in economic meltdown reflected TSMC`s unmatched technology and manufacturing service.
AMD`s farming contracts to TSMC has been within expectations of industry watchers expectations after AMD announced plans to spin off its manufacturing operation at the end of this year to focus on IC design. However, the contract-production schedule comes around half a year earlier than expected in light of the reported second-quarter 2009 production.
AMD has already contracted TSMC and United Microelectronics Corp. (UMC) to make graphic chips after merging ATI Technology, with TSMC offering manufacturing to newer chips whereas UMC offering service to its older chips.
Well, there was rumor from the new AMD CEO about their asset smart strategy and rumors have been going around for a while that AMD will be forced to get rid of their fabs (see AMD's Foundry Business). AMD has been in a brutal price war with Intel over the last few years and their purchase of ATI Graphics made it more difficult for them to move as they are heavily burdened with debt.
If they have entered into a partnership with TSMC then I think it will be win-win for both of them. AMD will be able to focus on designing competitive chips and will be able to offload their very expensive fabrication plants. Of course the news would be good for TSMC and would show further consolidation in the IC manufacturing industry. Remember last week we said Morris Chang predicted only three semiconductor manufacturing companies would be around in 10 years.
From a consumer perspective, a strong AMD is very important. AMD's superior product line a few years ago forced Intel's hand and made them develop better chips faster. It also reduced the overall processor prices and made computers cheaper. A semiconductor world without AMD would not be good. If outsourcing the manufacturing helps them to remain competitive in the design of chipsets and processors, then it is the right move for them.
No comments:
Post a Comment