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GlobalFoundries has halted development of its "7nm" low power node, will fire 5% of its staff, and will also halt most development of smaller nodes (such as "5nm" and "3nm"):
GlobalFoundries on Monday announced an important strategy shift. The contract maker of semiconductors decided to cease development of bleeding edge manufacturing technologies and stop all work on its 7LP (7 nm) fabrication processes, which will not be used for any client. Instead, the company will focus on specialized process technologies for clients in emerging high-growth markets. These technologies will initially be based on the company's 14LPP/12LP platform and will include RF, embedded memory, and low power features. Because of the strategy shift, GF will cut 5% of its staff as well as renegotiate its WSA and IP-related deals with AMD and IBM. In a bid to understand more what is going on, we sat down with Gary Patton, CTO of GlobalFoundries.
[...] Along with the cancellation of the 7LP, GlobalFoundries essentially canned all pathfinding and research operations for 5 nm and 3 nm nodes. The company will continue to work with the IBM Research Alliance (in Albany, NY) until the end of this year, but GlobalFoundries is not sure it makes sense to invest in R&D for 'bleeding edge' nodes given that it does not plan to use them any time soon. The manufacturer will continue to cooperate with IMEC, which works on a broader set of technologies that will be useful for GF's upcoming specialized fabrication processes, but obviously it will refocus its priorities there as well (more on GF's future process technologies later in this article).
So, the key takeaway here is that while the 7LP platform was a bit behind TSMC's CLN7FF when it comes to HVM – and GlobalFoundries has never been first to market with leading edge bulk manufacturing technologies anyway – there were no issues with the fabrication process itself. Rather there were deeper economic reasons behind the decision.
GlobalFoundries would have needed to use deep ultraviolet (DUV) instead of extreme ultraviolet (EUV) lithography for its initial "7nm" chips. It would have also required billions of dollars of investment to succeed on the "7nm" node, only to make less "7nm" chips than its competitors. The change in plans will require further renegotiation of GlobalFoundries' and AMD's Wafer Supply Agreement (WSA).
Meanwhile, AMD will move most of its business over to TSMC, although it may consider using Samsung:
In short, AMD is now shifting over the bulk of their bleeding-edge development to TSMC. The company is careful to note that they "intend to focus the breadth" of their 7nm production at TSMC rather than all 7nm production – leaving open the possibility of using TSMC rival Samsung in the future – but the message is clear that we should expect AMD's major 7nm products to be fabbed out of TSMC now that GlobalFoundries is no longer an option.
TSMC being AMD's new bleeding-edge partner should of course come as no surprise, as TSMC has been the fab AMD has fallen back on for other projects in the past. TSMC was until the most recent generation the fab AMD used for their GPUs, and it's where their semi-custom APUs for Microsoft and Sony have been made. Meanwhile AMD and TSMC have already previously announced that some of AMD's forthcoming 7nm products, including their 7nm Vega and "Rome" EPYC CPU would be fabbed by the Taiwanese foundry. So today's announcement is largely confirmation that AMD is going to continue down this path, with most (if not all) of their other planned 7nm products ending up at TSMC as well.
NO NO NO: AMD, GlobalFoundries Renew Vows, Focus on Path to 7nm (NO)
GlobalFoundries to Spend $10-12 Billion on a 7nm Fab, Possibly $14-18 Billion for 5nm (NO NO)
AnandTech Interview With the CTO of GlobalFoundries: 7nm EUV and 5 GHz Clock Speeds (NO NO NO)
Related: TSMC to Build 7nm Process Test Chips in Q1 2018
TSMC Holds Groundbreaking Ceremony for "5nm" Fab, Production to Begin in 2020
"3nm" Test Chip Taped Out by Imec and Cadence
TSMC Details Scaling/Performance Gains Expected From "5nm CLN5" Process
Samsung Roadmap Includes "5nm", "4nm" and "3nm" Manufacturing Nodes
AMD Ratcheting Up the Pressure on Intel
Samsung Plans to Make "5nm" Chips Starting in 2019-2020
TSMC Will Make AMD's "7nm" Epyc Server CPUs
(Score: 0) by Anonymous Coward on Tuesday August 28 2018, @03:02PM (2 children)
Some sales rep and sales manager just saw their biggest clients go to TSMC, which means kissing their sales commissions goodbye.
It may make a lot of financial sense for GF to stop burning cash in the R&D wars. These days, as soon as one fab technology is in production its successor (and its successor's successor) is already under development. That doesn't leave a lot of time to squeeze an ROI from the initial R&D costs (which are staggering in this industry). I guess cutting $20 - $30bn in future expenses means losing all the cutting edge client sales may turn out to be more profitable.
(Score: 4, Informative) by takyon on Tuesday August 28 2018, @03:20PM
I can imagine that GlobalFoundries gets out of the fab race, only to license a smaller node than "7nm" when it needs to. It's unclear how many new nodes there will be, but "5nm" and "3nm" are likely. The first "7nm" chips won't even use EUV, so they will be pretty expensive to produce. Untold billions will be spent on fabrication at these smaller nodes. TSMC will spend it, and Samsung will definitely spend it since they are making a killing off of memory and NAND.
GlobalFoundries could be better off ceding business to TSMC and Samsung for now. GloFo will come back later on some ridiculous node such as "3nm". Around that point, there will be few improvements left to make without radical changes such as quantum-exploiting transistors (e.g. TFETs), new materials, and 3D/stacked/layered chips, any of which will require additional $billions to develop.
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(Score: 2) by JoeMerchant on Tuesday August 28 2018, @03:50PM
He's part of the 5% (well, probably not counted in the 5%, but part of the RIF strategy anyway.)
🌻🌻 [google.com]
(Score: 2) by DannyB on Tuesday August 28 2018, @03:33PM (7 children)
Surely they know their business, their customers, etc. Maybe they don't have enough customer prospects for 7nm to see any profit in a reasonable time frame. So stick with what they've got, and existing contracts, and do it well at a good price.
Does that seem to capture the short version of what this is about?
The lower I set my standards the more accomplishments I have.
(Score: 2) by JoeMerchant on Tuesday August 28 2018, @03:58PM (3 children)
There was one hell of a big issue with the 7LP fabrication process itself: the cost to make it work. If they could have done it cheaply enough, they would have stayed with it and maybe even licensed their tech out to other foundries. They gauged the landscape, saw this wasn't going to be profitable for them, saw that they have large continuing markets for their 10 and 14nm processes, and figured that those buggy whips are good enough to keep flogging them for years to come.
When the old foundries can no longer operate profitably because all the customer money is going to the higher tech / lower power chips, then they'll switch over. Personally, I'm disappointed in the current generation of Intel NUCs because they're bumping up the power draws - I'd really like to see them going in the other direction, but that's not what the market is driving right now, maybe it's time for AMD to remind Intel that power consumption matters again, like they did around 2006.
Or, maybe someday, the ARM devices that power things like the RPi will finally get up to speed and give a "normal" computing experience. They've dramatically improved over the years, and I'd consider them "useable" as a graphic desktop for many tasks, but they're still not quite there as a total replacement for something like a NUC, whereas a NUC is a pretty good replacement for anything that isn't more or less trying to use a lot of compute resources.
🌻🌻 [google.com]
(Score: 2) by takyon on Tuesday August 28 2018, @04:03PM (2 children)
*12 and 14nm. "12nm" is a slightly improved version of the "14nm" process. They were going to skip "10nm" and go straight to "7nm". Now they are skipping it all.
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(Score: 2) by JoeMerchant on Tuesday August 28 2018, @08:29PM (1 child)
Crap sells - it's as easy as that, why develop something new and better when you can make money off of the existing formula?
This is all too true where I work, also.
🌻🌻 [google.com]
(Score: 3, Interesting) by takyon on Tuesday August 28 2018, @08:55PM
Older, mature nodes still get used years after they cease to be state-of-the-art.
https://en.wikipedia.org/wiki/65-nanometer_process [wikipedia.org]
Nikon Expeed 2 – 2010
MCST Elbrus 4C – 2014
SRISA 1890VM9Ya – 2016
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(Score: 4, Interesting) by takyon on Tuesday August 28 2018, @03:58PM (1 child)
It might not encompass the enormous impact of this decision. They are abandoning all development of smaller nodes. That doesn't mean they can't come back at a later date after skipping a couple of nodes, but they have left the race, perhaps for good (and for the good of the company). You're not going to be buying many more AMD/Nvidia products made by GlobalFoundries.
I can't really criticize this decision. TSMC and Samsung might end up looking like the suckers if they continue to blow $10-20 billion on new fabs. EUV has been delayed for years. 450mm wafers are dead in the water, maybe forever [eetimes.com].
https://en.wikipedia.org/wiki/Moore%27s_second_law [wikipedia.org]
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(Score: 2) by DannyB on Tuesday August 28 2018, @04:27PM
Interesting, and more comprehensible. Thanks.
The lower I set my standards the more accomplishments I have.
(Score: 2, Informative) by Anonymous Coward on Tuesday August 28 2018, @04:41PM
Competing with TSMC is tough. They currently control 56% of foundry market share:
https://www.semiwiki.com/forum/content/7693-globalfoundries-pivoting-away-bleeding-edge-technologies.html [semiwiki.com]
I imagine Samsung can stay in the race because of their internal product demand and knowledge sharing with their memory division. Intel's difficulties migrating to their 10nm (eff 7nm) node is well known, and with Intel moving to a new CEO the future of their foundry work is uncertain at best.
It will be interesting to see what happens to GF's 7nm process tools. EUV scanners are the biggest visibility, and also literally the biggest financially and physically. They already have their 14nm node yielding so printing with EUV in 14nm is overkill. If their financiers are trying to turn a profit those tools will probably get sold, but otherwise keeping those tools for experiments could be useful. Other process tools are less expensive and probably easier to stomach keeping on-site for an older process node.
I could see GF leveraging their 7nm learnings for making some very unique custom products. Particularly military and automotive applications have tough requirements: military needs USA made chips with high reliability and sometimes radiation hardening. Automotive components have safety regulations that can be stricter than healthcare tools and are rated for crazy environments (years of use ranging from Arizona heat to Florida humidity and salt to Alaska winters, while being exposed to the engine bay's heat cycling).
(Score: 3, Informative) by RamiK on Tuesday August 28 2018, @03:54PM (2 children)
https://www.extremetech.com/computing/276169-amd-moves-all-7nm-cpu-gpu-production-to-tsmc [extremetech.com]
NASDAQ: NVDA is hilarious :D
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(Score: 2) by takyon on Tuesday August 28 2018, @04:09PM (1 child)
So it won't be delayed to 2019? Nice.
AMD needs to bullshit up some cores that can do real-time raytracing. They probably aren't too far behind Nvidia since it was an inevitable development, Microsoft announced that raytracing API back in March, and there's been years of research preceding this. I guess we'll see if AMD tries to take on Nvidia with machine learning capabilities on the GPU (which can now be used for raytracing noise removal).
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(Score: 3, Interesting) by RamiK on Tuesday August 28 2018, @05:35PM
Meh. Just give me more polygons, decent video decode and FOSS it all up and I'm happy :D
Btw, 4th edition Real-Time Rendering just came out including Chakravarty's work on noise reduction so there might be alternative solutions referenced there that AMD might have developed/taken if you're feeling curious.
compiling...
(Score: 0) by Anonymous Coward on Tuesday August 28 2018, @05:06PM
"Meanwhile, AMD will move most of its business over to TSMC, although it may consider using Samsung:"
maybe now AMD will be able to put chips on the shelves when needed.