Qualcomm getting tired of TSMC, wants another company to fab their chips

by: ŠtefanJanuary 17, 2013

United Semiconductor has allegedly sent 28 nanometer samples to Qualcomm in an attempt to become their second fab parter. If that sentence went over your head, let’s break it down.

Qualcomm is a company that design chips. They don’t make them. That job is left for another company that owns what we in the industry like to call a “fab”. That’s short for silicon fabrication facility. TSMC, which stands for Taiwan Semiconductor, makes all of Qualcomm’s chips. That exclusive relationship hurt Qualcomm last year when they failed to keep up with demand. Which brings us to today’s news. Another company by the name of United Semiconductor, UMC for short, has made some chips using their fab that they’ve now sent to Qualcomm to evaluate. If Qualcomm likes what they see, then that means UMC effectively becomes Qualcomm’s second partner.

Why hasn’t Qualcomm done this sooner? Two reasons come to mind. The first one is simple. Qualcomm just didn’t have enough people. You can’t just design a chip for one fab and then use that same design in another fab. That’s sadly not how chip making works. The second reason is more strategic. Not all fabs are state of the art. Intel has the best fabs in the world, no one is denying that. And as for TSMC, they’re number two. Qualcomm, knowing this, likely wanted to rely solely on TSMC so that they could use the best of what the market offered them.

Everything you’ve read above comes from DigiTimes, so you should take it as a rumor. When are we going to find out if their report is accurate? Hopefully this year. We’re pulling that guess out of our asses by the way, but there’s some logic to it. By this time next year, we’ll already be talking about 20 nanometer chips, thus rendering UMC’s chips a full “generation” behind.

  • Manan Dedhia

    I think the title and the article are a little more than misleading. Qualcomm is not tired of TSMC. Or at least not in that sense of the term. TSMC had some serious glitches with their 28nm technology, due to which Global Foundries became the second favored fab for Qualcomm. It is part of risk mitigation. The strategy that you have two vendors make the same product for you makes sense because, first of all they have the demand to justify two vendors and second of all it gives them backup options. UMC is nowhere in the picture. UMC have their own bit of struggles at the moment. And yeah, talking of UMC, please get your acronym expansions accurate. Reading this article, I can only surmise that you kept having strokes writing it.

    • cycad007

      Agree that Qualcomm is not tired of TSMC. In fact, I believe they rather like their partnership with TSMC.

      That said…getting another partner foundry makes sense. I had heard it might have been Samsung, but if its Global Foundries or UMC…all the better.