Samsung Electronics Foundry Division, Semiconductor Research Institute, and Global Manufacturing & Infrastructure Overview came together in June 2022 to celebrate the mass production of the 3nm foundry process, forming a ‘3’ with their fingers. This year, major global fabless IT and semiconductor companies are expected to move towards adopting the 3nm process as their main manufacturing method, with most of them leaning towards TSMC over Samsung Electronics, potentially widening the market share gap between the two companies.
Reports suggest that seven prominent companies, including NVIDIA, AMD, Intel, Qualcomm, MediaTek, Apple, and Google, have opted for TSMC’s 3nm process over Samsung’s. Even Google and Qualcomm, who Samsung had been trying to attract as customers, have chosen TSMC for their future productions. For instance, Google’s Tensor processor will transition to TSMC from its fifth generation, and Qualcomm’s Snapdragon 8 Gen 4 was expected to be produced by TSMC, despite Samsung trying to secure the manufacturing contract.
Although Samsung Electronics declared the beginning of mass production for the 3nm process three years ago, they have struggled to acquire customers. Despite being the first to implement the 3nm gate-all-around (GAA) process for mass production, their first-generation 3nm node (SF3E) has faced performance and efficiency issues. The Exynos 2500, developed by Samsung System LSI Division using the 3nm process, has also underperformed.
One of the main problems with Samsung Foundry’s 3nm process is its lower performance and power efficiency compared to TSMC. In a market increasingly focused on energy-efficient chips due to the rising demand for AI services in mobile and server markets, Samsung’s chips have fallen short in meeting these demands. The energy efficiency of chips offered by TSMC has been cited as a key reason why major customers are choosing them over Samsung.
Furthermore, heat management challenges in semiconductors, particularly with the growing importance of AI semiconductors, have become critical issues for chipmakers. The representative of a major global foundry company pointed out that heat problems can potentially compromise the entire structure of smartphones for mobile chips, and lead to server overload for server chips.
The market share gap between TSMC and Samsung Electronics is also widening, with Samsung seeing a slight decrease in market share to 11% in the first quarter of this year, while TSMC’s market share increased to 61.7%. Samsung Electronics aims to address energy efficiency issues with the introduction of Backside Power Delivery (BSPDN) technology in their upcoming 2nm process, positioning it as a potential game-changer in the foundry industry. Samsung plans to accelerate the adoption of this technology, aiming to start mass production of the 2nm process either next year or in 2026.
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