Samsung and TSMC's battle

It is clear that Samsung has begun to focus on developing its foundry business. According to industry insiders, Samsung announced earlier that it would increase its foundry revenue to US$10 billion this year, becoming the world's second largest foundry, and would regard TSMC as its main competitor in the future.

Relevant data shows that the global foundry market is worth more than 50 billion US dollars, and TSMC alone accounts for 55% of the market share. Apple, AMD, NVIDIA, Xilinx, HiSilicon, Bitmain, etc. are all major customers of TSMC. According to people familiar with the matter, TSMC has adopted the 7nm process to produce the A12 processor for Apple.

Although Samsung missed out on Apple's processor orders, it has gained a major customer, Qualcomm, in the foundry market in recent years. Both Snapdragon 835 and Snapdragon 845 are manufactured using Samsung's 10nm process.

Before 2014, Apple and Samsung had maintained a cooperative relationship for many years. Since Steve Jobs released the first iPhone in 2007, Apple's first, second and third generations were all purchased from Samsung for ARM architecture chips, and the subsequent A4, A5, A6 and A7 were also manufactured by Samsung.

Details of Apple's mobile phone processor foundry are as follows:

In addition to their partnership in foundry, Samsung and Apple also compete in the smartphone market. In 2011, Apple filed a lawsuit against Samsung in the United States, claiming that Samsung infringed Apple's patents. At this time, Apple began the process of de-Samsungization. In the same year, there were rumors that Apple wanted TSMC to manufacture the A5 dual-core processor on the iPad2, but gave up because the yield rate was too low. This also shows that Apple is serious about de-Samsungization.

Since TSMC failed to catch up with Samsung in terms of yield, the A6 processor in the iPhone 5 released in 2012 was still manufactured by Samsung. The A7 processor in the iPhone 5S/5C released in 2013 was also manufactured by Samsung. Until 2014, the A8 processor in the iPhone 6/iPhone 6 Plus was all manufactured by TSMC .

2014 was a transition period for the foundry relationship between Samsung, TSMC and Apple for the A-series processors. There were three reasons for the transition. First, Apple was vigorously promoting the de-Samsungization, that is, if a supplier emerged that could compete with Samsung in terms of technology and production capacity, Apple would immediately abandon Samsung. Second, TSMC itself was very powerful. In 2014, TSMC not only completed the capacity expansion, but also achieved a breakthrough in the 20nm process, and the yield rate was greatly improved. Third, Samsung began to fall behind, and was unable to solve key problems at 20nm, and the yield rate could not be met.

Since TSMC has been found as a new partner, why did Samsung and TSMC share the order for the A9 processor in 2015? Relevant information shows that Samsung, which lost the A8 processor order, stepped up its offensive in order to grab the A9 processor order. It skipped 20nm in technology and went directly from 28nm to 14nm, giving the outside world the impression that they seemed to have caught up with Intel in technology. (However, it cannot be said that Samsung is completely exaggerating. Between 20nm and 14nm, the logic unit is actually the same size. The most important difference is the use of FinFET technology, which means that the outside world says that the logic unit structure has changed from planar to 3D. - From Zhihu)

However, Samsung, which finally won back Apple's orders, did not live up to expectations. Global netizens found that based on different testing methods such as playing videos and running test software, TSMC's processors can save up to 30% of power compared to Samsung's. This has led to Samsung's inability to win back orders from TSMC for the next A10, A11, and even the next A12.

In the field of wafer foundry, TSMC is a real strong rival. However, judging from Samsung's recent efforts in wafer foundry business, it is determined to fight TSMC to the end.

Along with the news that TSMC has begun using 7nm process to mass-produce Apple's A12 processor, Samsung also disclosed in its financial report that its 7nm EUV (extra ultraviolet lithography) process research and development has been completed and will be officially mass-produced in the second half of this year, half a year ahead of schedule.

According to Xinshiye, TSMC and Samsung have different technical routes in the 7nm process. TSMC uses traditional photolithography technology. Although it has taken the lead in mass production time, the performance improvement is not significant. Samsung uses more advanced EUV technology. Although it is extremely difficult, it has the advantage of close to the limit performance. Therefore, the processor manufactured by Samsung's 7nm EUV process is likely to have more advantages in performance and power consumption.

According to industry insiders, Samsung's 7nm R&D team has now fully turned to the research and development of the 5nm process. Since the two processes share the design database, the difficulty of 5nm will be reduced and its progress will be accelerated. At the same time, its 4nm and 3nm technologies are also being developed.

In terms of EUV advanced process, Samsung is ahead of TSMC. It is understood that TSMC will adopt EUV technology in 7nm+ next year, and the full application of EUV is expected to be 5nm in 2020.

Conclusion: Based on the above inference, under the premise of ensuring the production progress, according to the current plan, Samsung will produce 5nm chips in 2019, 4nm chips in 2020, and 3nm chips in 2021. To a certain extent, Samsung can maintain its lead over TSMC in technology. So in the short term, Samsung's goal is to become the world's second largest wafer foundry, and in the long term, it is not impossible to surpass TSMC.

"Xinshiye's media"