qualcomm tsmc umc
According to the Chinese Commercial Times (quoted by Digitimes), Qualcomm has struck a deal with Taiwan’s United Microelectronics for manufacturing 28nm Snapdragon S4 systems on a chip (SOC). If the paper is to be believed, UMC will start volume production during Q4 2012, and is expected to manufacture 3000-5000 wafers for Qualcomm during the quarter.

This news comes of no surprise, as it’s well known that the Taiwan Semiconductor Manufacturing Company (TSMC) is currently struggling to keep up with Qualcomm’s demand, a situation that has forced both Qualcomm (as well as Android device manufacturers) to swap the S4 chip found inside some Android devices with the older S3 SoC, one that is manufactured using the 32nm technology. Probably the best example in this case is the dumbed-down version of the HTC One S.

Further adding to the speculation, Qualcomm’s CEO Paul Jacobs was recently cited by Bloomberg stating that the company is considering “writing big checks” to ensure sufficient supply of Snapdragon S4 chips, despite the fact that TSMC officials have recently stepped up and claimed that they will “almost” meet their demand for Q4 2012, and will do so completely starting with Q1 2013. Nvidia, the other major TSMC client has also been rumored to turn to other semiconductor fabs in order to meet their demand for 28nm chips.

The chips manufactured by UMC will only complement and not substitute the chips manufactured by TSMC, as the 3000-5000 wafers rumored to be produced by UMC during Q4 amount for just 20-30 percent of the wafers that Qualcomm has placed with TSMC for the same time period. For a better perspective, you should be aware of the fact that TSMC is the the biggest semiconductor manufacturer that manufactures chips for fables chip makers. UMC ranks second in this chart.