Will 18-inch wafers really come?

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The 18-inch (450mm) wafer, which was still hotly discussed in the semiconductor industry just a few years ago, seems to have lost its driving force, at least for now. "The 18-inch wafer issue may continue to be dormant for 5 to 10 years," said G. Dan Hutcheson, CEO and senior semiconductor equipment analyst at market research firm VLSI Research. "Maybe it will come back to life, depending on whether semiconductor equipment manufacturers can reach a consensus."

The Global 450 Consortium (G450C), a research and development project that included Intel, TSMC, Globalfoundries, IBM, Samsung and SUNY Polytechnic Institute, quietly phased out operations at the end of last year, with member companies concluding that the time was not right to move into an optional second phase of the plan.

“All partners agree that this is not the right time to continue focusing on 18-inch technology,” Paul Kelly, assistant vice president of alliances and project planning at the State University of New York Polytechnic Institute, told EE Times. “But everyone says the G450C project itself is still a success.”

At the recent SEMI Industry Strategy Symposium in the United States, almost no one mentioned 18-inch wafers; but just a few years ago, major chip manufacturers, including G450C members, were actively promoting 18-inch wafer equipment to be installed in wafer fabs as early as 2018.

However, Hutcheson pointed out that the biggest obstacle facing 18-inch wafers comes from chip equipment manufacturers, who still remember the difficulties experienced when the industry switched to 12-inch wafers in the early 2000s. He said that if the industry promotes larger wafers and greatly reduces the unit demand of the industry, it will hurt the business of equipment manufacturers: "Equipment manufacturers just don't want to go through the pain of switching to 12-inch wafers again."

Hutcheson said that the industry initially promoted 18-inch wafers because it believed that when semiconductor companies could no longer keep up with Moore's Law, they would need an alternative solution to increase sales; but Moore's Law has obviously not come to an end: "The current situation is that process miniaturization has slowed down the growth of the chip market."

In the past few years, the semiconductor industry has stagnated and does not need to expand production capacity as much as before. Without sufficient demand for larger wafers, building 18-inch wafer fabs means that chipmakers must first retire 12-inch wafer fabs: "The reason why 18-inch technology is stuck is that it is a generation that is still too far away."

A spokesperson for semiconductor equipment giant Applied Materials said the company has put its 18-inch wafer plan on hold because the industry's interest in the technology has waned over the past few years: "We are instead focusing on helping our customers drive innovation with next-generation materials and device architectures. We will continue to monitor the progress of 18-inch technology and how to best support our customers."

Kelly of the State University of New York Polytechnic Institute emphasized that the purpose of the G450C project was to rigorously determine whether the migration to 18-inch wafers was technically feasible. In this regard, he believes that G450C was a complete success: "All members are satisfied that they can migrate to 18-inch technology when necessary."

Kelly pointed out that in addition to proving that 18-inch wafer technology is feasible, G450C members have also achieved other valuable progress, including the establishment of notchless wafer standards. However, the members of the alliance still believe that the current time is not suitable for advancing G450C to the second stage: "The members decided to restart the relevant work when they feel it is necessary."

The global 12-inch wafer production line continues to increase, and the road to 18-inch wafers is gradually moving away

As 12-inch wafers continue to expand their application to non-memory fields, the number of 12-inch wafer production lines around the world continues to increase. According to reports, there were nearly 100 production lines in 2016, an increase of about 20 production lines compared to five years ago, and it is expected that nearly 20 more production lines will be added in the next four years. In contrast, the commercialization schedule of 18-inch wafers will be further delayed. The industry expects that there will be no production lines using 18-inch wafers for mass production before 2020.

In addition to being used in memory chips that require mass production, such as DRAM and NAND Flash, 12-inch wafers are also continuously expanding their use in non-memory products, including power management chips, image sensors, etc., and are even used to manufacture logic chips, micro-component ICs, etc. In order to meet market demand and maximize chip production, semiconductor factories have adopted cutting-edge technology on 12-inch wafer production lines to promote process miniaturization and change materials.

According to data from ICInsights cited by South Korea's ETNEWS, the number of 12-inch wafer production lines increased from about 73 in 2010 to 87 in 2014. In 2015, there were 93 production lines using 12-inch wafers. In 2016, there were nearly 100 12-inch wafer fabs, especially with the entry of China, which has greatly increased the number of 12-inch wafer fabs. It is expected to increase to 110 in 2019. In terms of the market share of wafer size corresponding to production volume, the global 12-inch wafer market share has exceeded 60% in 2014 and has shown a rising trend year by year. In 2015, the proportion exceeded 62%, and it is estimated that it will approach 65% in 2019.

Although the next-generation 18-inch wafers can reduce the unit chip production cost, the introduction schedule continues to slow down. Currently, only a few production lines use 18-inch wafers for experimental production. Industry insiders expect that there will be no production lines using 18-inch wafers for mass production before 2020.

Semiconductor industry players believe that the slowdown in the introduction of 18-inch wafers is mainly due to the large-scale investment required in the initial stage. As the wafer size changes, related equipment must also be changed accordingly. Not only does it require the construction of new factories, but the equipment also needs to be replaced, which is a considerable burden for semiconductor and equipment manufacturers. Currently, most semiconductor industry players have turned to utilizing existing equipment and investing in miniaturized processes.

Semiconductor industry insiders pointed out that the 18-inch wafer plan was called off very early because there were too few manufacturers capable of entering the 18-inch wafer generation, with only TSMC, Samsung Electronics and Intel remaining. Although wafer fabs encouraged equipment manufacturers to invest in 18-inch wafer technology research and development, equipment manufacturers could not see any return on investment at all. Once the plan failed, it might lead to operational difficulties, causing major equipment manufacturers to put the brakes on.

The three major semiconductor manufacturers have different attitudes

According to digitimes, the global 18-inch wafer (450mm) generation schedule will be delayed to at least 2018. There are even reports that Intel has slowed down its research and development schedule. ASML, a major lithography equipment manufacturer, has also reportedly stopped developing new-generation 18-inch wafer machines. Currently, the company that is most anxious for the arrival of the 18-inch wafer generation should be Samsung Electronics, because it is focusing on 18-inch wafer factories with process technology below 10 nanometers, which will drive solid-state drives (SSDs) to replace traditional hard disk markets in large quantities.

Semiconductor industry insiders pointed out that the 18-inch wafer generation is the direction that the semiconductor industry must drive, but the technical barriers it faces are higher than expected, which may lead to delays in the mass production schedule. Currently, the semiconductor factories in the world that have the ability to enter the 18-inch wafer generation are TSMC, Intel and Samsung. As GlobalFoundries has joined the Samsung camp, subsequent developments still need to be observed, but the three major semiconductor factories obviously have different views on the urgency of the 18-inch wafer generation.

Semiconductor industry insiders said that in the past, when Intel dominated the PC era, it always rushed to be the first in the research and development of 8-inch and 12-inch wafer generations. However, because Intel did not catch up with the mobile communication explosion era, the pace of expanding production of 18-inch wafers may not be so urgent, which is very different from its past attitude.

Samsung is the most eager to promote 18-inch wafers. Samsung is the dominant player in DRAM and NAND Flash chips. Memory chips are standard mass-produced products that are highly sensitive to cost structure. Switching to 18-inch wafer fabs can reduce costs quickly. In addition, SSD demand is booming again, and the biggest application opportunities will no longer be in the field of personal storage, but in cloud storage and server applications required by large data centers. This has also made Samsung more eager to promote 18-inch wafers.

Semiconductor industry insiders believe that, for example, in SSD applications, if semiconductor manufacturers can drive to 18-inch wafers and produce NAND Flash chips with process technology below 10 nanometers, the SSD cost structure can be greatly reduced, and even traditional hard drives can be largely replaced, making SSD production extremely cost-effective. Therefore, Samsung will be the semiconductor manufacturer that is most active in promoting the 18-inch wafer generation.

After TSMC successfully seized market share in 28- and 20-nanometer processes, it has already completed blueprints for 16-, 10-, and 7-nanometer processes. Semiconductor industry insiders revealed that TSMC is also planning to develop 18-inch wafers, but will plan them more cautiously. Currently, the 10-nanometer process pilot line has not yet used extreme ultraviolet (EUV) equipment, and it is expected that multiple exposure lithography equipment will still be used for process miniaturization.

The industry expects that the 18-inch wafer generation will not arrive until at least 2018, and some semiconductor manufacturers even say it will be in 2020. Due to the high technical barriers, whether it can be adopted by TSMC, Intel and Samsung is a question. As for whether the huge R&D costs invested by equipment manufacturers can be recovered, it will also be a big problem.

Semiconductor industry insiders pointed out that semiconductor factories can reduce production costs through process miniaturization or increasing wafer size. Since process miniaturization has reached a bottleneck, especially below 10 nanometers, the difficulty has increased greatly. At present, it seems that the only way to expand output and thus reduce costs is to increase wafer size. Although the area of ​​​​wafers can be increased by 1.25 times from 12 inches to 18 inches, the investment in research and development and factory construction costs have soared. It is estimated that a 12-inch factory costs about US$2.5 billion, but an 18-inch factory starts at US$10 billion, which makes manufacturers hesitate.

360°: Global 450 Consortium

The global 18-inch wafer (450mm) development is mainly led by the Global 450 Consortium (G450C), an organization established in 2011 by the world's five largest semiconductor manufacturers TSMC, Intel, Samsung Electronics, IBM and Global Foundries.

The purpose of G450C is to coordinate the different opinions of semiconductor factories and equipment manufacturers on the development of 18-inch wafer generation technology. The high technical barriers of 18-inch wafers are a major problem, but in the future, the excessive concentration of semiconductor customers will lead to high development costs for equipment manufacturers, but they may not be able to get enough returns, which is a more serious problem because it will lead to doubts about investment by equipment manufacturers, and thus delay the semiconductor industry's entry into the 18-inch wafer generation. In order to allow semiconductor factories and equipment manufacturers to work more closely together, G450C was established.

In addition to forming industrial organizations, some semiconductor manufacturers have also made strategic investments in equipment manufacturers in order to accelerate the pace of equipment research and development. For example, Intel announced an investment of US$4.1 billion to acquire a stake in ASML, the most critical lithography equipment manufacturer. The first phase of research and development will focus on 450mm lithography technology, with an investment of US$680 million over five years, plus an investment of approximately US$2.1 billion in common stock to acquire a 10% stake. The second phase will be the development of EUV lithography technology, which will also be divided into five years, with an investment of approximately US$1.02 billion in technology research and development, and an additional investment of US$1 billion to acquire a 5% stake.

TSMC and Samsung Electronics also have similar strategic investments in ASML.

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